Correlation Between PC Tel and BK Technologies
Can any of the company-specific risk be diversified away by investing in both PC Tel 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 PC Tel and BK Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PC Tel Inc and BK Technologies, you can compare the effects of market volatilities on PC Tel 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 PC Tel with a short position of BK Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of PC Tel and BK Technologies.
Diversification Opportunities for PC Tel and BK Technologies
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PCTI and BKTI is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding PC Tel Inc and BK Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BK Technologies and PC Tel 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 PC Tel Inc 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 PC Tel i.e., PC Tel and BK Technologies go up and down completely randomly.
Pair Corralation between PC Tel and BK Technologies
If you would invest 2,630 in BK Technologies on September 2, 2024 and sell it today you would earn a total of 688.00 from holding BK Technologies or generate 26.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
PC Tel Inc vs. BK Technologies
Performance |
| Timeline |
| PC Tel Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| BK Technologies |
PC Tel and BK Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PC Tel and BK Technologies
The main advantage of trading using opposite PC Tel and BK Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PC Tel 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.| PC Tel vs. CAMP4 THERAPEUTICS PORATION | PC Tel vs. Frequency Electronics | PC Tel vs. Digi International | PC Tel vs. Ituran Location and |
| 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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