Correlation Between Interpublic Group and BKV
Can any of the company-specific risk be diversified away by investing in both Interpublic Group and BKV 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 Interpublic Group and BKV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Interpublic Group of and BKV Corporation, you can compare the effects of market volatilities on Interpublic Group and BKV 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 Interpublic Group with a short position of BKV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interpublic Group and BKV.
Diversification Opportunities for Interpublic Group and BKV
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Interpublic and BKV is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Interpublic Group of and BKV Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BKV Corporation and Interpublic 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 Interpublic Group of are associated (or correlated) with BKV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BKV Corporation has no effect on the direction of Interpublic Group i.e., Interpublic Group and BKV go up and down completely randomly.
Pair Corralation between Interpublic Group and BKV
Considering the 90-day investment horizon Interpublic Group of is expected to under-perform the BKV. But the stock apears to be less risky and, when comparing its historical volatility, Interpublic Group of is 1.29 times less risky than BKV. The stock trades about -0.01 of its potential returns per unit of risk. The BKV Corporation is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,800 in BKV Corporation on November 1, 2024 and sell it today you would earn a total of 720.00 from holding BKV Corporation or generate 40.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 17.21% |
| Values | Daily Returns |
Interpublic Group of vs. BKV Corp.
Performance |
| Timeline |
| Interpublic Group |
| BKV Corporation |
Interpublic Group and BKV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Interpublic Group and BKV
The main advantage of trading using opposite Interpublic Group and BKV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interpublic Group position performs unexpectedly, BKV 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 BKV will offset losses from the drop in BKV's long position.| Interpublic Group vs. Ziff Davis | Interpublic Group vs. Criteo Sa | Interpublic Group vs. WPP PLC ADR | Interpublic Group vs. Integral Ad Science |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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