Correlation Between Microequities Asset and Bendigo
Can any of the company-specific risk be diversified away by investing in both Microequities Asset and Bendigo 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 Microequities Asset and Bendigo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microequities Asset Management and Bendigo and Adelaide, you can compare the effects of market volatilities on Microequities Asset and Bendigo 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 Microequities Asset with a short position of Bendigo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microequities Asset and Bendigo.
Diversification Opportunities for Microequities Asset and Bendigo
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Microequities and Bendigo is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Microequities Asset Management and Bendigo and Adelaide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bendigo and Adelaide and Microequities 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 Microequities Asset Management are associated (or correlated) with Bendigo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bendigo and Adelaide has no effect on the direction of Microequities Asset i.e., Microequities Asset and Bendigo go up and down completely randomly.
Pair Corralation between Microequities Asset and Bendigo
Assuming the 90 days trading horizon Microequities Asset Management is expected to under-perform the Bendigo. In addition to that, Microequities Asset is 5.54 times more volatile than Bendigo and Adelaide. It trades about -0.03 of its total potential returns per unit of risk. Bendigo and Adelaide is currently generating about 0.01 per unit of volatility. If you would invest 10,368 in Bendigo and Adelaide on September 13, 2024 and sell it today you would earn a total of 7.00 from holding Bendigo and Adelaide or generate 0.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Microequities Asset Management vs. Bendigo and Adelaide
Performance |
| Timeline |
| Microequities Asset |
| Bendigo and Adelaide |
Microequities Asset and Bendigo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microequities Asset and Bendigo
The main advantage of trading using opposite Microequities Asset and Bendigo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microequities Asset position performs unexpectedly, Bendigo 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 Bendigo will offset losses from the drop in Bendigo's long position.| Microequities Asset vs. Australian United Investment | Microequities Asset vs. Clime Investment Management | Microequities Asset vs. REGAL ASIAN INVESTMENTS | Microequities Asset vs. Regal Investment |
| Bendigo vs. Regal Funds Management | Bendigo vs. Diversified United Investment | Bendigo vs. Microequities Asset Management | Bendigo vs. Flagship Investments |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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