Correlation Between Baylin Technologies and Gatekeeper Systems
Can any of the company-specific risk be diversified away by investing in both Baylin Technologies and Gatekeeper Systems 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 Baylin Technologies and Gatekeeper Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baylin Technologies and Gatekeeper Systems, you can compare the effects of market volatilities on Baylin Technologies and Gatekeeper Systems 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 Baylin Technologies with a short position of Gatekeeper Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baylin Technologies and Gatekeeper Systems.
Diversification Opportunities for Baylin Technologies and Gatekeeper Systems
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baylin and Gatekeeper is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Baylin Technologies and Gatekeeper Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gatekeeper Systems and Baylin Technologies 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 Baylin Technologies are associated (or correlated) with Gatekeeper Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gatekeeper Systems has no effect on the direction of Baylin Technologies i.e., Baylin Technologies and Gatekeeper Systems go up and down completely randomly.
Pair Corralation between Baylin Technologies and Gatekeeper Systems
Assuming the 90 days trading horizon Baylin Technologies is expected to generate 1.71 times more return on investment than Gatekeeper Systems. However, Baylin Technologies is 1.71 times more volatile than Gatekeeper Systems. It trades about 0.08 of its potential returns per unit of risk. Gatekeeper Systems is currently generating about 0.01 per unit of risk. If you would invest 28.00 in Baylin Technologies on August 31, 2024 and sell it today you would earn a total of 12.00 from holding Baylin Technologies or generate 42.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baylin Technologies vs. Gatekeeper Systems
Performance |
| Timeline |
| Baylin Technologies |
| Gatekeeper Systems |
Baylin Technologies and Gatekeeper Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baylin Technologies and Gatekeeper Systems
The main advantage of trading using opposite Baylin Technologies and Gatekeeper Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baylin Technologies position performs unexpectedly, Gatekeeper Systems 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 Gatekeeper Systems will offset losses from the drop in Gatekeeper Systems' long position.| Baylin Technologies vs. Quarterhill | Baylin Technologies vs. Diamond Estates Wines | Baylin Technologies vs. CareRx Corp |
| Gatekeeper Systems vs. AnalytixInsight | Gatekeeper Systems vs. Kraken Robotics | Gatekeeper Systems vs. ARHT Media |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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