Correlation Between Element Fleet and British Amer
Can any of the company-specific risk be diversified away by investing in both Element Fleet and British Amer 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 Element Fleet and British Amer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Element Fleet Management and biOasis Technologies, you can compare the effects of market volatilities on Element Fleet and British Amer 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 Element Fleet with a short position of British Amer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Element Fleet and British Amer.
Diversification Opportunities for Element Fleet and British Amer
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Element and British is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Element Fleet Management and biOasis Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on biOasis Technologies and Element Fleet 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 Element Fleet Management are associated (or correlated) with British Amer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of biOasis Technologies has no effect on the direction of Element Fleet i.e., Element Fleet and British Amer go up and down completely randomly.
Pair Corralation between Element Fleet and British Amer
Assuming the 90 days trading horizon Element Fleet is expected to generate 917.68 times less return on investment than British Amer. But when comparing it to its historical volatility, Element Fleet Management is 169.02 times less risky than British Amer. It trades about 0.05 of its potential returns per unit of risk. biOasis Technologies is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 125.00 in biOasis Technologies on September 12, 2024 and sell it today you would earn a total of 0.00 from holding biOasis Technologies or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Element Fleet Management vs. biOasis Technologies
Performance |
| Timeline |
| Element Fleet Management |
| biOasis Technologies |
Element Fleet and British Amer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Element Fleet and British Amer
The main advantage of trading using opposite Element Fleet and British Amer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Element Fleet position performs unexpectedly, British Amer 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 British Amer will offset losses from the drop in British Amer's long position.| Element Fleet vs. ECN Capital Corp | Element Fleet vs. Martinrea International | Element Fleet vs. CCL Industries | Element Fleet vs. FirstService Corp |
| British Amer vs. Renoworks Software | British Amer vs. Algonquin Power Utilities | British Amer vs. Calian Technologies | British Amer vs. Element Fleet Management |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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