Correlation Between Silicon Craft and BPS TECHNOLOGY
Can any of the company-specific risk be diversified away by investing in both Silicon Craft and BPS TECHNOLOGY 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 Silicon Craft and BPS TECHNOLOGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Silicon Craft Technology and BPS TECHNOLOGY PUBLIC, you can compare the effects of market volatilities on Silicon Craft and BPS TECHNOLOGY 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 Silicon Craft with a short position of BPS TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silicon Craft and BPS TECHNOLOGY.
Diversification Opportunities for Silicon Craft and BPS TECHNOLOGY
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Silicon and BPS is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Silicon Craft Technology and BPS TECHNOLOGY PUBLIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BPS TECHNOLOGY PUBLIC and Silicon Craft 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 Silicon Craft Technology are associated (or correlated) with BPS TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BPS TECHNOLOGY PUBLIC has no effect on the direction of Silicon Craft i.e., Silicon Craft and BPS TECHNOLOGY go up and down completely randomly.
Pair Corralation between Silicon Craft and BPS TECHNOLOGY
Assuming the 90 days trading horizon Silicon Craft Technology is expected to under-perform the BPS TECHNOLOGY. But the stock apears to be less risky and, when comparing its historical volatility, Silicon Craft Technology is 1.87 times less risky than BPS TECHNOLOGY. The stock trades about -0.05 of its potential returns per unit of risk. The BPS TECHNOLOGY PUBLIC is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 66.00 in BPS TECHNOLOGY PUBLIC on August 29, 2024 and sell it today you would lose (13.00) from holding BPS TECHNOLOGY PUBLIC or give up 19.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Silicon Craft Technology vs. BPS TECHNOLOGY PUBLIC
Performance |
| Timeline |
| Silicon Craft Technology |
| BPS TECHNOLOGY PUBLIC |
Silicon Craft and BPS TECHNOLOGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Silicon Craft and BPS TECHNOLOGY
The main advantage of trading using opposite Silicon Craft and BPS TECHNOLOGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silicon Craft position performs unexpectedly, BPS TECHNOLOGY 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 BPS TECHNOLOGY will offset losses from the drop in BPS TECHNOLOGY's long position.| Silicon Craft vs. North East Rubbers | Silicon Craft vs. Mega Lifesciences Public | Silicon Craft vs. KCE Electronics Public | Silicon Craft vs. Singer Thailand Public |
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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