Correlation Between Shift4 Payments and NV Bekaert
Can any of the company-specific risk be diversified away by investing in both Shift4 Payments and NV Bekaert 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 Shift4 Payments and NV Bekaert into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shift4 Payments and NV Bekaert SA, you can compare the effects of market volatilities on Shift4 Payments and NV Bekaert 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 Shift4 Payments with a short position of NV Bekaert. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shift4 Payments and NV Bekaert.
Diversification Opportunities for Shift4 Payments and NV Bekaert
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shift4 and BEKAY is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Shift4 Payments and NV Bekaert SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NV Bekaert SA and Shift4 Payments 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 Shift4 Payments are associated (or correlated) with NV Bekaert. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NV Bekaert SA has no effect on the direction of Shift4 Payments i.e., Shift4 Payments and NV Bekaert go up and down completely randomly.
Pair Corralation between Shift4 Payments and NV Bekaert
Given the investment horizon of 90 days Shift4 Payments is expected to generate 1.05 times more return on investment than NV Bekaert. However, Shift4 Payments is 1.05 times more volatile than NV Bekaert SA. It trades about 0.07 of its potential returns per unit of risk. NV Bekaert SA is currently generating about 0.02 per unit of risk. If you would invest 5,303 in Shift4 Payments on September 3, 2024 and sell it today you would earn a total of 6,105 from holding Shift4 Payments or generate 115.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 61.62% |
| Values | Daily Returns |
Shift4 Payments vs. NV Bekaert SA
Performance |
| Timeline |
| Shift4 Payments |
| NV Bekaert SA |
Shift4 Payments and NV Bekaert Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shift4 Payments and NV Bekaert
The main advantage of trading using opposite Shift4 Payments and NV Bekaert positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shift4 Payments position performs unexpectedly, NV Bekaert 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 NV Bekaert will offset losses from the drop in NV Bekaert's long position.| Shift4 Payments vs. SentinelOne | Shift4 Payments vs. Confluent | Shift4 Payments vs. Hashicorp | Shift4 Payments vs. MongoDB |
| NV Bekaert vs. Thyssenkrupp AG ON | NV Bekaert vs. Mueller Industries | NV Bekaert vs. Insteel Industries | NV Bekaert vs. Carpenter Technology |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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