Correlation Between Ras Technology and BKI Investment
Can any of the company-specific risk be diversified away by investing in both Ras Technology and BKI Investment 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 Ras Technology and BKI Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ras Technology Holdings and BKI Investment, you can compare the effects of market volatilities on Ras Technology and BKI Investment 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 Ras Technology with a short position of BKI Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ras Technology and BKI Investment.
Diversification Opportunities for Ras Technology and BKI Investment
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ras and BKI is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Ras Technology Holdings and BKI Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BKI Investment and Ras Technology 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 Ras Technology Holdings are associated (or correlated) with BKI Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BKI Investment has no effect on the direction of Ras Technology i.e., Ras Technology and BKI Investment go up and down completely randomly.
Pair Corralation between Ras Technology and BKI Investment
Assuming the 90 days trading horizon Ras Technology Holdings is expected to under-perform the BKI Investment. In addition to that, Ras Technology is 3.57 times more volatile than BKI Investment. It trades about -0.06 of its total potential returns per unit of risk. BKI Investment is currently generating about 0.02 per unit of volatility. If you would invest 168.00 in BKI Investment on September 1, 2024 and sell it today you would earn a total of 4.00 from holding BKI Investment or generate 2.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ras Technology Holdings vs. BKI Investment
Performance |
| Timeline |
| Ras Technology Holdings |
| BKI Investment |
Ras Technology and BKI Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ras Technology and BKI Investment
The main advantage of trading using opposite Ras Technology and BKI Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ras Technology position performs unexpectedly, BKI Investment 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 BKI Investment will offset losses from the drop in BKI Investment's long position.| Ras Technology vs. Aneka Tambang Tbk | Ras Technology vs. Unibail Rodamco Westfield SE | Ras Technology vs. Macquarie Group | Ras Technology vs. Commonwealth Bank |
| BKI Investment vs. GQG Partners DRC | BKI Investment vs. MFF Capital Investments | BKI Investment vs. Metrics Master Income | BKI Investment vs. L1 Long Short |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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