Correlation Between Baylin Technologies and Thermal Energy
Can any of the company-specific risk be diversified away by investing in both Baylin Technologies and Thermal Energy 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 Thermal Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baylin Technologies and Thermal Energy International, you can compare the effects of market volatilities on Baylin Technologies and Thermal Energy 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 Thermal Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baylin Technologies and Thermal Energy.
Diversification Opportunities for Baylin Technologies and Thermal Energy
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baylin and Thermal is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Baylin Technologies and Thermal Energy International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thermal Energy Inter 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 Thermal Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thermal Energy Inter has no effect on the direction of Baylin Technologies i.e., Baylin Technologies and Thermal Energy go up and down completely randomly.
Pair Corralation between Baylin Technologies and Thermal Energy
Assuming the 90 days trading horizon Baylin Technologies is expected to under-perform the Thermal Energy. In addition to that, Baylin Technologies is 1.9 times more volatile than Thermal Energy International. It trades about -0.14 of its total potential returns per unit of risk. Thermal Energy International is currently generating about 0.02 per unit of volatility. If you would invest 20.00 in Thermal Energy International on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Thermal Energy International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baylin Technologies vs. Thermal Energy International
Performance |
| Timeline |
| Baylin Technologies |
| Thermal Energy Inter |
Baylin Technologies and Thermal Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baylin Technologies and Thermal Energy
The main advantage of trading using opposite Baylin Technologies and Thermal Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baylin Technologies position performs unexpectedly, Thermal Energy 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 Thermal Energy will offset losses from the drop in Thermal Energy's long position.| Baylin Technologies vs. Current Water Technologies | Baylin Technologies vs. Sparta Capital | Baylin Technologies vs. Fintech Select | Baylin Technologies vs. iShares Canadian HYBrid |
| Thermal Energy vs. Firan Technology Group | Thermal Energy vs. Baylin Technologies | Thermal Energy vs. iShares Canadian HYBrid | Thermal Energy vs. Altagas Cum Red |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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