Correlation Between Blue Star and SupplyMe Capital
Can any of the company-specific risk be diversified away by investing in both Blue Star and SupplyMe Capital at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Blue Star and SupplyMe Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Star Capital and SupplyMe Capital PLC, you can compare the effects of market volatilities on Blue Star and SupplyMe Capital and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Blue Star with a short position of SupplyMe Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Star and SupplyMe Capital.
Diversification Opportunities for Blue Star and SupplyMe Capital
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Blue and SupplyMe is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Blue Star Capital and SupplyMe Capital PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SupplyMe Capital PLC and Blue Star is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Blue Star Capital are associated (or correlated) with SupplyMe Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SupplyMe Capital PLC has no effect on the direction of Blue Star i.e., Blue Star and SupplyMe Capital go up and down completely randomly.
Pair Corralation between Blue Star and SupplyMe Capital
Assuming the 90 days trading horizon Blue Star Capital is expected to generate 4.91 times more return on investment than SupplyMe Capital. However, Blue Star is 4.91 times more volatile than SupplyMe Capital PLC. It trades about 0.03 of its potential returns per unit of risk. SupplyMe Capital PLC is currently generating about -0.01 per unit of risk. If you would invest 3,800 in Blue Star Capital on October 14, 2024 and sell it today you would lose (3,550) from holding Blue Star Capital or give up 93.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Star Capital vs. SupplyMe Capital PLC
Performance |
| Timeline |
| Blue Star Capital |
| SupplyMe Capital PLC |
Blue Star and SupplyMe Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Star and SupplyMe Capital
The main advantage of trading using opposite Blue Star and SupplyMe Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Star position performs unexpectedly, SupplyMe Capital can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in SupplyMe Capital will offset losses from the drop in SupplyMe Capital's long position.| Blue Star vs. SupplyMe Capital PLC | Blue Star vs. SM Energy Co | Blue Star vs. FuelCell Energy | Blue Star vs. Grand Vision Media |
| SupplyMe Capital vs. Panther Metals PLC | SupplyMe Capital vs. URU Metals | SupplyMe Capital vs. Power Metal Resources | SupplyMe Capital vs. LPKF Laser Electronics |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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