Correlation Between BTS Group and BCPG Public
Can any of the company-specific risk be diversified away by investing in both BTS Group and BCPG Public 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 BTS Group and BCPG Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BTS Group Holdings and BCPG Public, you can compare the effects of market volatilities on BTS Group and BCPG Public 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 BTS Group with a short position of BCPG Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTS Group and BCPG Public.
Diversification Opportunities for BTS Group and BCPG Public
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between BTS and BCPG is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding BTS Group Holdings and BCPG Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCPG Public and BTS Group 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 BTS Group Holdings are associated (or correlated) with BCPG Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCPG Public has no effect on the direction of BTS Group i.e., BTS Group and BCPG Public go up and down completely randomly.
Pair Corralation between BTS Group and BCPG Public
Assuming the 90 days trading horizon BTS Group Holdings is expected to generate 1.12 times more return on investment than BCPG Public. However, BTS Group is 1.12 times more volatile than BCPG Public. It trades about -0.03 of its potential returns per unit of risk. BCPG Public is currently generating about -0.05 per unit of risk. If you would invest 804.00 in BTS Group Holdings on August 29, 2024 and sell it today you would lose (274.00) from holding BTS Group Holdings or give up 34.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTS Group Holdings vs. BCPG Public
Performance |
| Timeline |
| BTS Group Holdings |
| BCPG Public |
BTS Group and BCPG Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTS Group and BCPG Public
The main advantage of trading using opposite BTS Group and BCPG Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTS Group position performs unexpectedly, BCPG Public 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 BCPG Public will offset losses from the drop in BCPG Public's long position.| BTS Group vs. Tata Steel Public | BTS Group vs. Thaifoods Group Public | BTS Group vs. TMT Steel Public | BTS Group vs. The Erawan Group |
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 Stocks Directory module to find actively traded stocks across global markets.
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