Correlation Between International Business and Idex Biometrics
Can any of the company-specific risk be diversified away by investing in both International Business and Idex Biometrics 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 International Business and Idex Biometrics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Business Machines and Idex Biometrics ASA, you can compare the effects of market volatilities on International Business and Idex Biometrics 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 International Business with a short position of Idex Biometrics. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Business and Idex Biometrics.
Diversification Opportunities for International Business and Idex Biometrics
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between International and Idex is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding International Business Machine and Idex Biometrics ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Idex Biometrics ASA and International Business 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 International Business Machines are associated (or correlated) with Idex Biometrics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Idex Biometrics ASA has no effect on the direction of International Business i.e., International Business and Idex Biometrics go up and down completely randomly.
Pair Corralation between International Business and Idex Biometrics
Considering the 90-day investment horizon International Business Machines is expected to generate 0.66 times more return on investment than Idex Biometrics. However, International Business Machines is 1.53 times less risky than Idex Biometrics. It trades about 0.13 of its potential returns per unit of risk. Idex Biometrics ASA is currently generating about -0.39 per unit of risk. If you would invest 12,665 in International Business Machines on August 28, 2024 and sell it today you would earn a total of 9,948 from holding International Business Machines or generate 78.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.24% |
| Values | Daily Returns |
International Business Machine vs. Idex Biometrics ASA
Performance |
| Timeline |
| International Business |
| Idex Biometrics ASA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
International Business and Idex Biometrics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Business and Idex Biometrics
The main advantage of trading using opposite International Business and Idex Biometrics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Business position performs unexpectedly, Idex Biometrics 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 Idex Biometrics will offset losses from the drop in Idex Biometrics' long position.| International Business vs. Data Storage Corp | International Business vs. Usio Inc | International Business vs. ARB IOT Group | International Business vs. FiscalNote Holdings |
| Idex Biometrics vs. Bubblr Inc | Idex Biometrics vs. WonderFi Technologies | Idex Biometrics vs. Oblong Inc | Idex Biometrics vs. Where Food Comes |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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