Correlation Between Schmitt Industries and Bonso Electronics
Can any of the company-specific risk be diversified away by investing in both Schmitt Industries and Bonso Electronics 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 Schmitt Industries and Bonso Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schmitt Industries and Bonso Electronics International, you can compare the effects of market volatilities on Schmitt Industries and Bonso Electronics 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 Schmitt Industries with a short position of Bonso Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schmitt Industries and Bonso Electronics.
Diversification Opportunities for Schmitt Industries and Bonso Electronics
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Schmitt and Bonso is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Schmitt Industries and Bonso Electronics Internationa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonso Electronics and Schmitt Industries 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 Schmitt Industries are associated (or correlated) with Bonso Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonso Electronics has no effect on the direction of Schmitt Industries i.e., Schmitt Industries and Bonso Electronics go up and down completely randomly.
Pair Corralation between Schmitt Industries and Bonso Electronics
If you would invest 303.00 in Bonso Electronics International on September 1, 2024 and sell it today you would lose (44.00) from holding Bonso Electronics International or give up 14.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 3.33% |
| Values | Daily Returns |
Schmitt Industries vs. Bonso Electronics Internationa
Performance |
| Timeline |
| Schmitt Industries |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Bonso Electronics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Schmitt Industries and Bonso Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schmitt Industries and Bonso Electronics
The main advantage of trading using opposite Schmitt Industries and Bonso Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schmitt Industries position performs unexpectedly, Bonso Electronics 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 Bonso Electronics will offset losses from the drop in Bonso Electronics' long position.| Schmitt Industries vs. Nanalysis Scientific Corp | Schmitt Industries vs. Genasys | Schmitt Industries vs. Kraken Robotics | Schmitt Industries vs. Mesa Laboratories |
| Bonso Electronics vs. Cepton Inc | Bonso Electronics vs. SaverOne 2014 Ltd | Bonso Electronics vs. Genasys | Bonso Electronics vs. Kraken Robotics |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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