Correlation Between Batm Advanced and Hershey
Can any of the company-specific risk be diversified away by investing in both Batm Advanced and Hershey 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 Batm Advanced and Hershey into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Batm Advanced Communications and Hershey Co, you can compare the effects of market volatilities on Batm Advanced and Hershey 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 Batm Advanced with a short position of Hershey. Check out your portfolio center. Please also check ongoing floating volatility patterns of Batm Advanced and Hershey.
Diversification Opportunities for Batm Advanced and Hershey
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Batm and Hershey is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Batm Advanced Communications and Hershey Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hershey and Batm Advanced 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 Batm Advanced Communications are associated (or correlated) with Hershey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hershey has no effect on the direction of Batm Advanced i.e., Batm Advanced and Hershey go up and down completely randomly.
Pair Corralation between Batm Advanced and Hershey
Assuming the 90 days trading horizon Batm Advanced Communications is expected to generate 2.0 times more return on investment than Hershey. However, Batm Advanced is 2.0 times more volatile than Hershey Co. It trades about -0.01 of its potential returns per unit of risk. Hershey Co is currently generating about -0.07 per unit of risk. If you would invest 2,500 in Batm Advanced Communications on September 25, 2024 and sell it today you would lose (580.00) from holding Batm Advanced Communications or give up 23.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.8% |
| Values | Daily Returns |
Batm Advanced Communications vs. Hershey Co
Performance |
| Timeline |
| Batm Advanced Commun |
| Hershey |
Batm Advanced and Hershey Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Batm Advanced and Hershey
The main advantage of trading using opposite Batm Advanced and Hershey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Batm Advanced position performs unexpectedly, Hershey 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 Hershey will offset losses from the drop in Hershey's long position.| Batm Advanced vs. SupplyMe Capital PLC | Batm Advanced vs. Lloyds Banking Group | Batm Advanced vs. Premier African Minerals | Batm Advanced vs. SANTANDER UK 8 |
| Hershey vs. XLMedia PLC | Hershey vs. MediaZest plc | Hershey vs. Zinc Media Group | Hershey vs. Nordic Semiconductor ASA |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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