Correlation Between Frequency Electronics and BeWhere Holdings
Can any of the company-specific risk be diversified away by investing in both Frequency Electronics and BeWhere Holdings 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 Frequency Electronics and BeWhere Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Frequency Electronics and BeWhere Holdings, you can compare the effects of market volatilities on Frequency Electronics and BeWhere Holdings 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 Frequency Electronics with a short position of BeWhere Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Frequency Electronics and BeWhere Holdings.
Diversification Opportunities for Frequency Electronics and BeWhere Holdings
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Frequency and BeWhere is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Frequency Electronics and BeWhere Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BeWhere Holdings and Frequency Electronics 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 Frequency Electronics are associated (or correlated) with BeWhere Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BeWhere Holdings has no effect on the direction of Frequency Electronics i.e., Frequency Electronics and BeWhere Holdings go up and down completely randomly.
Pair Corralation between Frequency Electronics and BeWhere Holdings
Given the investment horizon of 90 days Frequency Electronics is expected to generate 0.3 times more return on investment than BeWhere Holdings. However, Frequency Electronics is 3.38 times less risky than BeWhere Holdings. It trades about 0.35 of its potential returns per unit of risk. BeWhere Holdings is currently generating about -0.05 per unit of risk. If you would invest 1,258 in Frequency Electronics on August 29, 2024 and sell it today you would earn a total of 130.00 from holding Frequency Electronics or generate 10.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Frequency Electronics vs. BeWhere Holdings
Performance |
| Timeline |
| Frequency Electronics |
| BeWhere Holdings |
Frequency Electronics and BeWhere Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Frequency Electronics and BeWhere Holdings
The main advantage of trading using opposite Frequency Electronics and BeWhere Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Frequency Electronics position performs unexpectedly, BeWhere Holdings 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 BeWhere Holdings will offset losses from the drop in BeWhere Holdings' long position.| Frequency Electronics vs. BK Technologies | Frequency Electronics vs. Actelis Networks | Frequency Electronics vs. Lantronix | Frequency Electronics vs. KVH Industries |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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