Correlation Between Baijiayun and MMTEC
Can any of the company-specific risk be diversified away by investing in both Baijiayun and MMTEC 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 Baijiayun and MMTEC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baijiayun Group and MMTEC Inc, you can compare the effects of market volatilities on Baijiayun and MMTEC 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 Baijiayun with a short position of MMTEC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baijiayun and MMTEC.
Diversification Opportunities for Baijiayun and MMTEC
Modest diversification
The 3 months correlation between Baijiayun and MMTEC is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Baijiayun Group and MMTEC Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MMTEC Inc and Baijiayun 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 Baijiayun Group are associated (or correlated) with MMTEC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MMTEC Inc has no effect on the direction of Baijiayun i.e., Baijiayun and MMTEC go up and down completely randomly.
Pair Corralation between Baijiayun and MMTEC
Considering the 90-day investment horizon Baijiayun is expected to generate 5.8 times less return on investment than MMTEC. But when comparing it to its historical volatility, Baijiayun Group is 1.65 times less risky than MMTEC. It trades about 0.01 of its potential returns per unit of risk. MMTEC Inc is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 84.00 in MMTEC Inc on August 31, 2024 and sell it today you would lose (61.00) from holding MMTEC Inc or give up 72.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baijiayun Group vs. MMTEC Inc
Performance |
| Timeline |
| Baijiayun Group |
| MMTEC Inc |
Baijiayun and MMTEC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baijiayun and MMTEC
The main advantage of trading using opposite Baijiayun and MMTEC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baijiayun position performs unexpectedly, MMTEC 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 MMTEC will offset losses from the drop in MMTEC's long position.| Baijiayun vs. Issuer Direct Corp | Baijiayun vs. eGain | Baijiayun vs. Research Solutions | Baijiayun vs. Paycor HCM |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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