Correlation Between Bankers Investment and Polar Capital
Can any of the company-specific risk be diversified away by investing in both Bankers Investment and Polar 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 Bankers Investment and Polar Capital 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 Polar Capital Technology, you can compare the effects of market volatilities on Bankers Investment and Polar 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 Bankers Investment with a short position of Polar Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankers Investment and Polar Capital.
Diversification Opportunities for Bankers Investment and Polar Capital
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bankers and Polar is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Bankers Investment Trust and Polar Capital Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polar Capital Technology 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 Polar Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polar Capital Technology has no effect on the direction of Bankers Investment i.e., Bankers Investment and Polar Capital go up and down completely randomly.
Pair Corralation between Bankers Investment and Polar Capital
Assuming the 90 days trading horizon Bankers Investment is expected to generate 4.66 times less return on investment than Polar Capital. But when comparing it to its historical volatility, Bankers Investment Trust is 1.64 times less risky than Polar Capital. It trades about 0.04 of its potential returns per unit of risk. Polar Capital Technology is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 18,080 in Polar Capital Technology on October 11, 2024 and sell it today you would earn a total of 17,220 from holding Polar Capital Technology or generate 95.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
Bankers Investment Trust vs. Polar Capital Technology
Performance |
| Timeline |
| Bankers Investment Trust |
| Polar Capital Technology |
Bankers Investment and Polar Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankers Investment and Polar Capital
The main advantage of trading using opposite Bankers Investment and Polar Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankers Investment position performs unexpectedly, Polar 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 Polar Capital will offset losses from the drop in Polar Capital's long position.| Bankers Investment vs. Atalaya Mining | Bankers Investment vs. Europa Metals | Bankers Investment vs. Wheaton Precious Metals | Bankers Investment vs. Adriatic Metals |
| Polar Capital vs. Smithson Investment Trust | Polar Capital vs. Bankers Investment Trust | Polar Capital vs. Zoom Video Communications | Polar Capital vs. New Residential 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |