Correlation Between Bankers Investment and Brunner Investment
Can any of the company-specific risk be diversified away by investing in both Bankers Investment and Brunner Investment 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 Bankers Investment and Brunner Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bankers Investment Trust and Brunner Investment Trust, you can compare the effects of market volatilities on Bankers Investment and Brunner Investment 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 Bankers Investment with a short position of Brunner Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankers Investment and Brunner Investment.
Diversification Opportunities for Bankers Investment and Brunner Investment
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bankers and Brunner is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Bankers Investment Trust and Brunner Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunner Investment Trust and Bankers Investment 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 Bankers Investment Trust are associated (or correlated) with Brunner Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunner Investment Trust has no effect on the direction of Bankers Investment i.e., Bankers Investment and Brunner Investment go up and down completely randomly.
Pair Corralation between Bankers Investment and Brunner Investment
Assuming the 90 days trading horizon Bankers Investment is expected to generate 1.65 times less return on investment than Brunner Investment. But when comparing it to its historical volatility, Bankers Investment Trust is 1.27 times less risky than Brunner Investment. It trades about 0.1 of its potential returns per unit of risk. Brunner Investment Trust is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 100,623 in Brunner Investment Trust on September 12, 2024 and sell it today you would earn a total of 49,377 from holding Brunner Investment Trust or generate 49.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.7% |
| Values | Daily Returns |
Bankers Investment Trust vs. Brunner Investment Trust
Performance |
| Timeline |
| Bankers Investment Trust |
| Brunner Investment Trust |
Bankers Investment and Brunner Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankers Investment and Brunner Investment
The main advantage of trading using opposite Bankers Investment and Brunner Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankers Investment position performs unexpectedly, Brunner Investment 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 Brunner Investment will offset losses from the drop in Brunner Investment's long position.| Bankers Investment vs. Liberty Media Corp | Bankers Investment vs. Panther Metals PLC | Bankers Investment vs. Centaur Media | Bankers Investment vs. GoldMining |
| Brunner Investment vs. Fresenius Medical Care | Brunner Investment vs. Bankers Investment Trust | Brunner Investment vs. Deltex Medical Group | Brunner Investment vs. Hansa Investment |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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