Correlation Between Bytes Technology and ANGLE Plc
Can any of the company-specific risk be diversified away by investing in both Bytes Technology and ANGLE Plc 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 Bytes Technology and ANGLE Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bytes Technology and ANGLE plc, you can compare the effects of market volatilities on Bytes Technology and ANGLE Plc 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 Bytes Technology with a short position of ANGLE Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bytes Technology and ANGLE Plc.
Diversification Opportunities for Bytes Technology and ANGLE Plc
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bytes and ANGLE is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Bytes Technology and ANGLE plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANGLE plc and Bytes Technology 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 Bytes Technology are associated (or correlated) with ANGLE Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANGLE plc has no effect on the direction of Bytes Technology i.e., Bytes Technology and ANGLE Plc go up and down completely randomly.
Pair Corralation between Bytes Technology and ANGLE Plc
Assuming the 90 days trading horizon Bytes Technology is expected to generate 7.93 times less return on investment than ANGLE Plc. But when comparing it to its historical volatility, Bytes Technology is 2.06 times less risky than ANGLE Plc. It trades about 0.05 of its potential returns per unit of risk. ANGLE plc is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 975.00 in ANGLE plc on October 20, 2024 and sell it today you would earn a total of 138.00 from holding ANGLE plc or generate 14.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bytes Technology vs. ANGLE plc
Performance |
| Timeline |
| Bytes Technology |
| ANGLE plc |
Bytes Technology and ANGLE Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bytes Technology and ANGLE Plc
The main advantage of trading using opposite Bytes Technology and ANGLE Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bytes Technology position performs unexpectedly, ANGLE Plc 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 ANGLE Plc will offset losses from the drop in ANGLE Plc's long position.| Bytes Technology vs. National Beverage Corp | Bytes Technology vs. Associated British Foods | Bytes Technology vs. Bellevue Healthcare Trust | Bytes Technology vs. Abingdon Health Plc |
| ANGLE Plc vs. Eastman Chemical Co | ANGLE Plc vs. Medical Properties Trust | ANGLE Plc vs. Cellnex Telecom SA | ANGLE Plc vs. Morgan Advanced Materials |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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