Correlation Between REGAL ASIAN and BSP Financial
Can any of the company-specific risk be diversified away by investing in both REGAL ASIAN and BSP Financial 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 REGAL ASIAN and BSP Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REGAL ASIAN INVESTMENTS and BSP Financial Group, you can compare the effects of market volatilities on REGAL ASIAN and BSP Financial 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 REGAL ASIAN with a short position of BSP Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of REGAL ASIAN and BSP Financial.
Diversification Opportunities for REGAL ASIAN and BSP Financial
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between REGAL and BSP is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding REGAL ASIAN INVESTMENTS and BSP Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BSP Financial Group and REGAL ASIAN 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 REGAL ASIAN INVESTMENTS are associated (or correlated) with BSP Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BSP Financial Group has no effect on the direction of REGAL ASIAN i.e., REGAL ASIAN and BSP Financial go up and down completely randomly.
Pair Corralation between REGAL ASIAN and BSP Financial
Assuming the 90 days trading horizon REGAL ASIAN INVESTMENTS is expected to under-perform the BSP Financial. But the stock apears to be less risky and, when comparing its historical volatility, REGAL ASIAN INVESTMENTS is 1.17 times less risky than BSP Financial. The stock trades about -0.02 of its potential returns per unit of risk. The BSP Financial Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 630.00 in BSP Financial Group on August 29, 2024 and sell it today you would earn a total of 20.00 from holding BSP Financial Group or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
REGAL ASIAN INVESTMENTS vs. BSP Financial Group
Performance |
| Timeline |
| REGAL ASIAN INVESTMENTS |
| BSP Financial Group |
REGAL ASIAN and BSP Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REGAL ASIAN and BSP Financial
The main advantage of trading using opposite REGAL ASIAN and BSP Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REGAL ASIAN position performs unexpectedly, BSP Financial 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 BSP Financial will offset losses from the drop in BSP Financial's long position.| REGAL ASIAN vs. ABACUS STORAGE KING | REGAL ASIAN vs. Odyssey Energy | REGAL ASIAN vs. Hotel Property Investments | REGAL ASIAN vs. Origin Energy |
| BSP Financial vs. Energy Resources | BSP Financial vs. 88 Energy | BSP Financial vs. Amani Gold | BSP Financial vs. A1 Investments Resources |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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