Correlation Between Physitrack PLC and Bonzun AB
Can any of the company-specific risk be diversified away by investing in both Physitrack PLC and Bonzun AB 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 Physitrack PLC and Bonzun AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Physitrack PLC and Bonzun AB, you can compare the effects of market volatilities on Physitrack PLC and Bonzun AB 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 Physitrack PLC with a short position of Bonzun AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Physitrack PLC and Bonzun AB.
Diversification Opportunities for Physitrack PLC and Bonzun AB
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Physitrack and Bonzun is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Physitrack PLC and Bonzun AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonzun AB and Physitrack PLC 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 Physitrack PLC are associated (or correlated) with Bonzun AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonzun AB has no effect on the direction of Physitrack PLC i.e., Physitrack PLC and Bonzun AB go up and down completely randomly.
Pair Corralation between Physitrack PLC and Bonzun AB
Assuming the 90 days trading horizon Physitrack PLC is expected to generate 0.48 times more return on investment than Bonzun AB. However, Physitrack PLC is 2.08 times less risky than Bonzun AB. It trades about -0.11 of its potential returns per unit of risk. Bonzun AB is currently generating about -0.08 per unit of risk. If you would invest 1,510 in Physitrack PLC on September 1, 2024 and sell it today you would lose (710.00) from holding Physitrack PLC or give up 47.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Physitrack PLC vs. Bonzun AB
Performance |
| Timeline |
| Physitrack PLC |
| Bonzun AB |
Physitrack PLC and Bonzun AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Physitrack PLC and Bonzun AB
The main advantage of trading using opposite Physitrack PLC and Bonzun AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Physitrack PLC position performs unexpectedly, Bonzun AB 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 Bonzun AB will offset losses from the drop in Bonzun AB's long position.| Physitrack PLC vs. AVTECH Sweden AB | Physitrack PLC vs. K2A Knaust Andersson | Physitrack PLC vs. eEducation Albert AB | Physitrack PLC vs. Footway Group AB |
| Bonzun AB vs. AVTECH Sweden AB | Bonzun AB vs. K2A Knaust Andersson | Bonzun AB vs. eEducation Albert AB | Bonzun AB vs. Footway Group AB |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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