Correlation Between Biopower Operations and POSCO Holdings
Can any of the company-specific risk be diversified away by investing in both Biopower Operations and POSCO Holdings 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 Biopower Operations and POSCO Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biopower Operations Corp and POSCO Holdings, you can compare the effects of market volatilities on Biopower Operations and POSCO Holdings 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 Biopower Operations with a short position of POSCO Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biopower Operations and POSCO Holdings.
Diversification Opportunities for Biopower Operations and POSCO Holdings
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Biopower and POSCO is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Biopower Operations Corp and POSCO Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POSCO Holdings and Biopower Operations 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 Biopower Operations Corp are associated (or correlated) with POSCO Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POSCO Holdings has no effect on the direction of Biopower Operations i.e., Biopower Operations and POSCO Holdings go up and down completely randomly.
Pair Corralation between Biopower Operations and POSCO Holdings
Given the investment horizon of 90 days Biopower Operations Corp is expected to generate 4.69 times more return on investment than POSCO Holdings. However, Biopower Operations is 4.69 times more volatile than POSCO Holdings. It trades about 0.01 of its potential returns per unit of risk. POSCO Holdings is currently generating about -0.06 per unit of risk. If you would invest 13.00 in Biopower Operations Corp on September 12, 2024 and sell it today you would lose (12.99) from holding Biopower Operations Corp or give up 99.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Biopower Operations Corp vs. POSCO Holdings
Performance |
| Timeline |
| Biopower Operations Corp |
| POSCO Holdings |
Biopower Operations and POSCO Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biopower Operations and POSCO Holdings
The main advantage of trading using opposite Biopower Operations and POSCO Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biopower Operations position performs unexpectedly, POSCO Holdings 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 POSCO Holdings will offset losses from the drop in POSCO Holdings' long position.| Biopower Operations vs. POSCO Holdings | Biopower Operations vs. Schweizerische Nationalbank | Biopower Operations vs. Berkshire Hathaway | Biopower Operations vs. Berkshire Hathaway |
| POSCO Holdings vs. Olympic Steel | POSCO Holdings vs. Universal Stainless Alloy | POSCO Holdings vs. Outokumpu Oyj ADR | POSCO Holdings vs. Ternium SA ADR |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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