Correlation Between Ras Technology and BTC Health
Can any of the company-specific risk be diversified away by investing in both Ras Technology and BTC Health 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 BTC Health 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 BTC Health Limited, you can compare the effects of market volatilities on Ras Technology and BTC Health 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 BTC Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ras Technology and BTC Health.
Diversification Opportunities for Ras Technology and BTC Health
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ras and BTC is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ras Technology Holdings and BTC Health Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTC Health Limited 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 BTC Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTC Health Limited has no effect on the direction of Ras Technology i.e., Ras Technology and BTC Health go up and down completely randomly.
Pair Corralation between Ras Technology and BTC Health
Assuming the 90 days trading horizon Ras Technology is expected to generate 8.7 times less return on investment than BTC Health. But when comparing it to its historical volatility, Ras Technology Holdings is 2.08 times less risky than BTC Health. It trades about 0.06 of its potential returns per unit of risk. BTC Health Limited is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 5.90 in BTC Health Limited on October 11, 2024 and sell it today you would earn a total of 1.50 from holding BTC Health Limited or generate 25.42% 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. BTC Health Limited
Performance |
| Timeline |
| Ras Technology Holdings |
| BTC Health Limited |
Ras Technology and BTC Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ras Technology and BTC Health
The main advantage of trading using opposite Ras Technology and BTC Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ras Technology position performs unexpectedly, BTC Health 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 BTC Health will offset losses from the drop in BTC Health's long position.| Ras Technology vs. Sky Metals | Ras Technology vs. Group 6 Metals | Ras Technology vs. ARN Media Limited | Ras Technology vs. Autosports Group |
| BTC Health vs. Neurotech International | BTC Health vs. Retail Food Group | BTC Health vs. Charter Hall Retail | BTC Health vs. Zoom2u Technologies |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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