Correlation Between B Riley and DTE Energy
Can any of the company-specific risk be diversified away by investing in both B Riley and DTE Energy 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 B Riley and DTE Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between B Riley Financial and DTE Energy Co, you can compare the effects of market volatilities on B Riley and DTE Energy 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 B Riley with a short position of DTE Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of B Riley and DTE Energy.
Diversification Opportunities for B Riley and DTE Energy
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between RILYZ and DTE is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding B Riley Financial and DTE Energy Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DTE Energy and B Riley 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 B Riley Financial are associated (or correlated) with DTE Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DTE Energy has no effect on the direction of B Riley i.e., B Riley and DTE Energy go up and down completely randomly.
Pair Corralation between B Riley and DTE Energy
Assuming the 90 days horizon B Riley Financial is expected to under-perform the DTE Energy. In addition to that, B Riley is 9.61 times more volatile than DTE Energy Co. It trades about -0.02 of its total potential returns per unit of risk. DTE Energy Co is currently generating about 0.02 per unit of volatility. If you would invest 2,271 in DTE Energy Co on August 31, 2024 and sell it today you would earn a total of 27.00 from holding DTE Energy Co or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
B Riley Financial vs. DTE Energy Co
Performance |
| Timeline |
| B Riley Financial |
| DTE Energy |
B Riley and DTE Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with B Riley and DTE Energy
The main advantage of trading using opposite B Riley and DTE Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if B Riley position performs unexpectedly, DTE Energy 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 DTE Energy will offset losses from the drop in DTE Energy's long position.| B Riley vs. B Riley Financial | B Riley vs. B Riley Financial | B Riley vs. B Riley Financial, | B Riley vs. B Riley Financial |
| DTE Energy vs. Southern Co | DTE Energy vs. Duke Energy Corp | DTE Energy vs. Georgia Power Co | DTE Energy vs. Entergy Arkansas LLC |
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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