Correlation Between Grande Asset and BEC World
Can any of the company-specific risk be diversified away by investing in both Grande Asset and BEC World 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 Grande Asset and BEC World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grande Asset Hotels and BEC World Public, you can compare the effects of market volatilities on Grande Asset and BEC World 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 Grande Asset with a short position of BEC World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grande Asset and BEC World.
Diversification Opportunities for Grande Asset and BEC World
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Grande and BEC is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Grande Asset Hotels and BEC World Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BEC World Public and Grande Asset 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 Grande Asset Hotels are associated (or correlated) with BEC World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BEC World Public has no effect on the direction of Grande Asset i.e., Grande Asset and BEC World go up and down completely randomly.
Pair Corralation between Grande Asset and BEC World
Assuming the 90 days trading horizon Grande Asset Hotels is expected to generate 1.01 times more return on investment than BEC World. However, Grande Asset is 1.01 times more volatile than BEC World Public. It trades about 0.04 of its potential returns per unit of risk. BEC World Public is currently generating about 0.04 per unit of risk. If you would invest 23.00 in Grande Asset Hotels on November 28, 2024 and sell it today you would lose (18.00) from holding Grande Asset Hotels or give up 78.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grande Asset Hotels vs. BEC World Public
Performance |
| Timeline |
| Grande Asset Hotels |
| BEC World Public |
Grande Asset and BEC World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grande Asset and BEC World
The main advantage of trading using opposite Grande Asset and BEC World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grande Asset position performs unexpectedly, BEC World 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 BEC World will offset losses from the drop in BEC World's long position.| Grande Asset vs. Internet Thailand Public | Grande Asset vs. Saksiam Leasing Public | Grande Asset vs. Quality Hospitality Leasehold | Grande Asset vs. Mitsib Leasing Public |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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