Correlation Between Boldt SA and Carboclor
Can any of the company-specific risk be diversified away by investing in both Boldt SA and Carboclor 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 Boldt SA and Carboclor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boldt SA and Carboclor, you can compare the effects of market volatilities on Boldt SA and Carboclor 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 Boldt SA with a short position of Carboclor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boldt SA and Carboclor.
Diversification Opportunities for Boldt SA and Carboclor
Very poor diversification
The 3 months correlation between Boldt and Carboclor is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Boldt SA and Carboclor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carboclor and Boldt SA 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 Boldt SA are associated (or correlated) with Carboclor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carboclor has no effect on the direction of Boldt SA i.e., Boldt SA and Carboclor go up and down completely randomly.
Pair Corralation between Boldt SA and Carboclor
Assuming the 90 days trading horizon Boldt SA is expected to generate 1.29 times more return on investment than Carboclor. However, Boldt SA is 1.29 times more volatile than Carboclor. It trades about 0.03 of its potential returns per unit of risk. Carboclor is currently generating about 0.02 per unit of risk. If you would invest 5,020 in Boldt SA on September 13, 2024 and sell it today you would earn a total of 300.00 from holding Boldt SA or generate 5.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.19% |
| Values | Daily Returns |
Boldt SA vs. Carboclor
Performance |
| Timeline |
| Boldt SA |
| Carboclor |
Boldt SA and Carboclor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boldt SA and Carboclor
The main advantage of trading using opposite Boldt SA and Carboclor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boldt SA position performs unexpectedly, Carboclor 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 Carboclor will offset losses from the drop in Carboclor's long position.| Boldt SA vs. B Gaming SA | Boldt SA vs. Edesa Holding SA | Boldt SA vs. Vista Energy, SAB | Boldt SA vs. United States Steel |
| Carboclor vs. Harmony Gold Mining | Carboclor vs. Compania de Transporte | Carboclor vs. United States Steel | Carboclor vs. Transportadora de Gas |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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