Correlation Between Intchains Group and BK Technologies
Can any of the company-specific risk be diversified away by investing in both Intchains Group and BK Technologies 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 Intchains Group and BK Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intchains Group Limited and BK Technologies, you can compare the effects of market volatilities on Intchains Group and BK Technologies 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 Intchains Group with a short position of BK Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intchains Group and BK Technologies.
Diversification Opportunities for Intchains Group and BK Technologies
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Intchains and BKTI is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Intchains Group Limited and BK Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BK Technologies and Intchains Group 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 Intchains Group Limited are associated (or correlated) with BK Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BK Technologies has no effect on the direction of Intchains Group i.e., Intchains Group and BK Technologies go up and down completely randomly.
Pair Corralation between Intchains Group and BK Technologies
Considering the 90-day investment horizon Intchains Group is expected to generate 2.74 times less return on investment than BK Technologies. But when comparing it to its historical volatility, Intchains Group Limited is 1.69 times less risky than BK Technologies. It trades about 0.16 of its potential returns per unit of risk. BK Technologies is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 2,667 in BK Technologies on August 30, 2024 and sell it today you would earn a total of 680.00 from holding BK Technologies or generate 25.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intchains Group Limited vs. BK Technologies
Performance |
| Timeline |
| Intchains Group |
| BK Technologies |
Intchains Group and BK Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intchains Group and BK Technologies
The main advantage of trading using opposite Intchains Group and BK Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intchains Group position performs unexpectedly, BK Technologies 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 BK Technologies will offset losses from the drop in BK Technologies' long position.| Intchains Group vs. PepsiCo | Intchains Group vs. 51Talk Online Education | Intchains Group vs. China Tontine Wines | Intchains Group vs. Monster Beverage Corp |
| BK Technologies vs. Frequency Electronics | BK Technologies vs. Actelis Networks | BK Technologies vs. Optical Cable | BK Technologies vs. Baylin Technologies |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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