Correlation Between Duke Energy and Brockhaus Capital
Can any of the company-specific risk be diversified away by investing in both Duke Energy and Brockhaus Capital 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 Duke Energy and Brockhaus Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Duke Energy and Brockhaus Capital Management, you can compare the effects of market volatilities on Duke Energy and Brockhaus Capital 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 Duke Energy with a short position of Brockhaus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duke Energy and Brockhaus Capital.
Diversification Opportunities for Duke Energy and Brockhaus Capital
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Duke and Brockhaus is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Duke Energy and Brockhaus Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brockhaus Capital and Duke Energy 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 Duke Energy are associated (or correlated) with Brockhaus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brockhaus Capital has no effect on the direction of Duke Energy i.e., Duke Energy and Brockhaus Capital go up and down completely randomly.
Pair Corralation between Duke Energy and Brockhaus Capital
Assuming the 90 days trading horizon Duke Energy is expected to generate 0.48 times more return on investment than Brockhaus Capital. However, Duke Energy is 2.07 times less risky than Brockhaus Capital. It trades about -0.03 of its potential returns per unit of risk. Brockhaus Capital Management is currently generating about -0.08 per unit of risk. If you would invest 10,980 in Duke Energy on October 24, 2024 and sell it today you would lose (298.00) from holding Duke Energy or give up 2.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duke Energy vs. Brockhaus Capital Management
Performance |
| Timeline |
| Duke Energy |
| Brockhaus Capital |
Duke Energy and Brockhaus Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duke Energy and Brockhaus Capital
The main advantage of trading using opposite Duke Energy and Brockhaus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duke Energy position performs unexpectedly, Brockhaus Capital 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 Brockhaus Capital will offset losses from the drop in Brockhaus Capital's long position.| Duke Energy vs. Brockhaus Capital Management | Duke Energy vs. Easy Software AG | Duke Energy vs. GBS Software AG | Duke Energy vs. Axway Software SA |
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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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