Correlation Between Retailors and Blender Financial
Can any of the company-specific risk be diversified away by investing in both Retailors and Blender 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 Retailors and Blender Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Retailors and Blender Financial Technologies, you can compare the effects of market volatilities on Retailors and Blender 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 Retailors with a short position of Blender Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retailors and Blender Financial.
Diversification Opportunities for Retailors and Blender Financial
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Retailors and Blender is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Retailors and Blender Financial Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blender Financial and Retailors 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 Retailors are associated (or correlated) with Blender Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blender Financial has no effect on the direction of Retailors i.e., Retailors and Blender Financial go up and down completely randomly.
Pair Corralation between Retailors and Blender Financial
Assuming the 90 days trading horizon Retailors is expected to generate 1.2 times more return on investment than Blender Financial. However, Retailors is 1.2 times more volatile than Blender Financial Technologies. It trades about 0.28 of its potential returns per unit of risk. Blender Financial Technologies is currently generating about -0.34 per unit of risk. If you would invest 641,300 in Retailors on August 28, 2024 and sell it today you would earn a total of 110,200 from holding Retailors or generate 17.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Retailors vs. Blender Financial Technologies
Performance |
| Timeline |
| Retailors |
| Blender Financial |
Retailors and Blender Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retailors and Blender Financial
The main advantage of trading using opposite Retailors and Blender Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retailors position performs unexpectedly, Blender 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 Blender Financial will offset losses from the drop in Blender Financial's long position.| Retailors vs. Nice | Retailors vs. The Gold Bond | Retailors vs. Bank Leumi Le Israel | Retailors vs. ICL Israel Chemicals |
| Blender Financial vs. Wilk Technologies | Blender Financial vs. YH Dimri Construction | Blender Financial vs. Bezeq Israeli Telecommunication | Blender Financial vs. Teuza A Fairchild |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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