Correlation Between Binance Coin and Gencor Industries
Can any of the company-specific risk be diversified away by investing in both Binance Coin and Gencor Industries 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 Binance Coin and Gencor Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binance Coin and Gencor Industries, you can compare the effects of market volatilities on Binance Coin and Gencor Industries 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 Binance Coin with a short position of Gencor Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binance Coin and Gencor Industries.
Diversification Opportunities for Binance Coin and Gencor Industries
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Binance and Gencor is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Binance Coin and Gencor Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gencor Industries and Binance Coin 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 Binance Coin are associated (or correlated) with Gencor Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gencor Industries has no effect on the direction of Binance Coin i.e., Binance Coin and Gencor Industries go up and down completely randomly.
Pair Corralation between Binance Coin and Gencor Industries
Assuming the 90 days trading horizon Binance Coin is expected to generate 1.28 times more return on investment than Gencor Industries. However, Binance Coin is 1.28 times more volatile than Gencor Industries. It trades about 0.13 of its potential returns per unit of risk. Gencor Industries is currently generating about -0.22 per unit of risk. If you would invest 60,601 in Binance Coin on October 20, 2024 and sell it today you would earn a total of 11,468 from holding Binance Coin or generate 18.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.18% |
| Values | Daily Returns |
Binance Coin vs. Gencor Industries
Performance |
| Timeline |
| Binance Coin |
| Gencor Industries |
Binance Coin and Gencor Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binance Coin and Gencor Industries
The main advantage of trading using opposite Binance Coin and Gencor Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binance Coin position performs unexpectedly, Gencor Industries 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 Gencor Industries will offset losses from the drop in Gencor Industries' long position.| Binance Coin vs. Staked Ether | Binance Coin vs. Cronos | Binance Coin vs. Wrapped Bitcoin | Binance Coin vs. Monero |
| Gencor Industries vs. Alamo Group | Gencor Industries vs. Manitowoc | Gencor Industries vs. Columbus McKinnon | Gencor Industries vs. Rev Group |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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