Correlation Between GobiMin and NV Bekaert
Can any of the company-specific risk be diversified away by investing in both GobiMin 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 GobiMin and NV Bekaert into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GobiMin and NV Bekaert SA, you can compare the effects of market volatilities on GobiMin 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 GobiMin with a short position of NV Bekaert. Check out your portfolio center. Please also check ongoing floating volatility patterns of GobiMin and NV Bekaert.
Diversification Opportunities for GobiMin and NV Bekaert
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GobiMin and BEKAY is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding GobiMin 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 GobiMin 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 GobiMin 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 GobiMin i.e., GobiMin and NV Bekaert go up and down completely randomly.
Pair Corralation between GobiMin and NV Bekaert
Assuming the 90 days horizon GobiMin is expected to generate 2.54 times less return on investment than NV Bekaert. But when comparing it to its historical volatility, GobiMin is 8.43 times less risky than NV Bekaert. It trades about 0.08 of its potential returns per unit of risk. NV Bekaert SA is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 351.00 in NV Bekaert SA on September 3, 2024 and sell it today you would earn a total of 36.00 from holding NV Bekaert SA or generate 10.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 19.67% |
| Values | Daily Returns |
GobiMin vs. NV Bekaert SA
Performance |
| Timeline |
| GobiMin |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| NV Bekaert SA |
GobiMin and NV Bekaert Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GobiMin and NV Bekaert
The main advantage of trading using opposite GobiMin and NV Bekaert positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GobiMin 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.| GobiMin vs. Proficient Auto Logistics, | GobiMin vs. Hafnia Limited | GobiMin vs. Alvotech | GobiMin vs. Omni Health |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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