Correlation Between Biztech Konsulting and Poznanska Korporacja
Can any of the company-specific risk be diversified away by investing in both Biztech Konsulting and Poznanska Korporacja 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 Biztech Konsulting and Poznanska Korporacja into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biztech Konsulting SA and Poznanska Korporacja Budowlana, you can compare the effects of market volatilities on Biztech Konsulting and Poznanska Korporacja 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 Biztech Konsulting with a short position of Poznanska Korporacja. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biztech Konsulting and Poznanska Korporacja.
Diversification Opportunities for Biztech Konsulting and Poznanska Korporacja
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Biztech and Poznanska is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Biztech Konsulting SA and Poznanska Korporacja Budowlana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Poznanska Korporacja and Biztech Konsulting 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 Biztech Konsulting SA are associated (or correlated) with Poznanska Korporacja. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Poznanska Korporacja has no effect on the direction of Biztech Konsulting i.e., Biztech Konsulting and Poznanska Korporacja go up and down completely randomly.
Pair Corralation between Biztech Konsulting and Poznanska Korporacja
Assuming the 90 days trading horizon Biztech Konsulting SA is expected to generate 3.35 times more return on investment than Poznanska Korporacja. However, Biztech Konsulting is 3.35 times more volatile than Poznanska Korporacja Budowlana. It trades about 0.14 of its potential returns per unit of risk. Poznanska Korporacja Budowlana is currently generating about -0.37 per unit of risk. If you would invest 15.00 in Biztech Konsulting SA on September 14, 2024 and sell it today you would earn a total of 2.00 from holding Biztech Konsulting SA or generate 13.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Biztech Konsulting SA vs. Poznanska Korporacja Budowlana
Performance |
| Timeline |
| Biztech Konsulting |
| Poznanska Korporacja |
Biztech Konsulting and Poznanska Korporacja Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biztech Konsulting and Poznanska Korporacja
The main advantage of trading using opposite Biztech Konsulting and Poznanska Korporacja positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biztech Konsulting position performs unexpectedly, Poznanska Korporacja 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 Poznanska Korporacja will offset losses from the drop in Poznanska Korporacja's long position.| Biztech Konsulting vs. Mlk Foods Public | Biztech Konsulting vs. GreenX Metals | Biztech Konsulting vs. M Food SA | Biztech Konsulting vs. Movie Games SA |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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