Correlation Between British Amer and Balkan Mining
Can any of the company-specific risk be diversified away by investing in both British Amer and Balkan Mining 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 British Amer and Balkan Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bailador Technology Invest and Balkan Mining and, you can compare the effects of market volatilities on British Amer and Balkan Mining 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 British Amer with a short position of Balkan Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of British Amer and Balkan Mining.
Diversification Opportunities for British Amer and Balkan Mining
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between British and Balkan is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Bailador Technology Invest and Balkan Mining and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Balkan Mining and British Amer 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 Bailador Technology Invest are associated (or correlated) with Balkan Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Balkan Mining has no effect on the direction of British Amer i.e., British Amer and Balkan Mining go up and down completely randomly.
Pair Corralation between British Amer and Balkan Mining
Assuming the 90 days trading horizon British Amer is expected to generate 81.53 times less return on investment than Balkan Mining. But when comparing it to its historical volatility, Bailador Technology Invest is 5.42 times less risky than Balkan Mining. It trades about 0.0 of its potential returns per unit of risk. Balkan Mining and is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 5.60 in Balkan Mining and on October 12, 2024 and sell it today you would lose (0.50) from holding Balkan Mining and or give up 8.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bailador Technology Invest vs. Balkan Mining and
Performance |
| Timeline |
| Bailador Technology |
| Balkan Mining |
British Amer and Balkan Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with British Amer and Balkan Mining
The main advantage of trading using opposite British Amer and Balkan Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if British Amer position performs unexpectedly, Balkan Mining 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 Balkan Mining will offset losses from the drop in Balkan Mining's long position.| British Amer vs. Collins Foods | British Amer vs. Ramsay Health Care | British Amer vs. EVE Health Group | British Amer vs. Austco Healthcare |
| Balkan Mining vs. Bailador Technology Invest | Balkan Mining vs. Falcon Metals | Balkan Mining vs. Aussie Broadband | Balkan Mining vs. Queste Communications |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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