Correlation Between Event Hospitality and Bendigo

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Can any of the company-specific risk be diversified away by investing in both Event Hospitality and Bendigo 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 Event Hospitality and Bendigo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Event Hospitality and and Bendigo And Adelaide, you can compare the effects of market volatilities on Event Hospitality and Bendigo 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 Event Hospitality with a short position of Bendigo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Event Hospitality and Bendigo.

Diversification Opportunities for Event Hospitality and Bendigo

0.86
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Event and Bendigo is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Event Hospitality and and Bendigo And Adelaide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bendigo And Adelaide and Event Hospitality 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 Event Hospitality and are associated (or correlated) with Bendigo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bendigo And Adelaide has no effect on the direction of Event Hospitality i.e., Event Hospitality and Bendigo go up and down completely randomly.

Pair Corralation between Event Hospitality and Bendigo

Assuming the 90 days trading horizon Event Hospitality is expected to generate 8.69 times less return on investment than Bendigo. In addition to that, Event Hospitality is 1.37 times more volatile than Bendigo And Adelaide. It trades about 0.01 of its total potential returns per unit of risk. Bendigo And Adelaide is currently generating about 0.08 per unit of volatility. If you would invest  862.00  in Bendigo And Adelaide on September 19, 2024 and sell it today you would earn a total of  485.00  from holding Bendigo And Adelaide or generate 56.26% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Event Hospitality and  vs.  Bendigo And Adelaide

 Performance 
       Timeline  
Event Hospitality 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Event Hospitality and are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Event Hospitality may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Bendigo And Adelaide 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Bendigo And Adelaide are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Bendigo may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Event Hospitality and Bendigo Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Event Hospitality and Bendigo

The main advantage of trading using opposite Event Hospitality and Bendigo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Event Hospitality position performs unexpectedly, Bendigo 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 Bendigo will offset losses from the drop in Bendigo's long position.
The idea behind Event Hospitality and and Bendigo And Adelaide pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.

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