Correlation Between Polar Capital and Batm Advanced
Can any of the company-specific risk be diversified away by investing in both Polar Capital and Batm Advanced 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 Polar Capital and Batm Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polar Capital Technology and Batm Advanced Communications, you can compare the effects of market volatilities on Polar Capital and Batm Advanced 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 Polar Capital with a short position of Batm Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polar Capital and Batm Advanced.
Diversification Opportunities for Polar Capital and Batm Advanced
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Polar and Batm is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Polar Capital Technology and Batm Advanced Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Batm Advanced Commun and Polar Capital 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 Polar Capital Technology are associated (or correlated) with Batm Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Batm Advanced Commun has no effect on the direction of Polar Capital i.e., Polar Capital and Batm Advanced go up and down completely randomly.
Pair Corralation between Polar Capital and Batm Advanced
Assuming the 90 days trading horizon Polar Capital Technology is expected to generate 0.62 times more return on investment than Batm Advanced. However, Polar Capital Technology is 1.61 times less risky than Batm Advanced. It trades about 0.15 of its potential returns per unit of risk. Batm Advanced Communications is currently generating about 0.02 per unit of risk. If you would invest 31,450 in Polar Capital Technology on August 30, 2024 and sell it today you would earn a total of 1,750 from holding Polar Capital Technology or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Polar Capital Technology vs. Batm Advanced Communications
Performance |
| Timeline |
| Polar Capital Technology |
| Batm Advanced Commun |
Polar Capital and Batm Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polar Capital and Batm Advanced
The main advantage of trading using opposite Polar Capital and Batm Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polar Capital position performs unexpectedly, Batm Advanced 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 Batm Advanced will offset losses from the drop in Batm Advanced's long position.| Polar Capital vs. Samsung Electronics Co | Polar Capital vs. Samsung Electronics Co | Polar Capital vs. Hyundai Motor | Polar Capital vs. Toyota Motor Corp |
| Batm Advanced vs. Roadside Real Estate | Batm Advanced vs. Broadridge Financial Solutions | Batm Advanced vs. Atresmedia | Batm Advanced vs. Intermediate Capital Group |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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