Correlation Between Stepstone and Berkeley Lights
Can any of the company-specific risk be diversified away by investing in both Stepstone and Berkeley Lights 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 Stepstone and Berkeley Lights into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stepstone Group and Berkeley Lights, you can compare the effects of market volatilities on Stepstone and Berkeley Lights 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 Stepstone with a short position of Berkeley Lights. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stepstone and Berkeley Lights.
Diversification Opportunities for Stepstone and Berkeley Lights
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Stepstone and Berkeley is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Stepstone Group and Berkeley Lights in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkeley Lights and Stepstone 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 Stepstone Group are associated (or correlated) with Berkeley Lights. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berkeley Lights has no effect on the direction of Stepstone i.e., Stepstone and Berkeley Lights go up and down completely randomly.
Pair Corralation between Stepstone and Berkeley Lights
If you would invest 2,562 in Stepstone Group on September 4, 2024 and sell it today you would earn a total of 3,723 from holding Stepstone Group or generate 145.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 0.4% |
| Values | Daily Returns |
Stepstone Group vs. Berkeley Lights
Performance |
| Timeline |
| Stepstone Group |
| Berkeley Lights |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Stepstone and Berkeley Lights Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stepstone and Berkeley Lights
The main advantage of trading using opposite Stepstone and Berkeley Lights positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stepstone position performs unexpectedly, Berkeley Lights 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 Berkeley Lights will offset losses from the drop in Berkeley Lights' long position.| Stepstone vs. Munivest Fund | Stepstone vs. Blackrock Muniyield Quality | Stepstone vs. Federated Investors B | Stepstone vs. Federated Premier Municipal |
| Berkeley Lights vs. Morgan Stanley | Berkeley Lights vs. Nasdaq Inc | Berkeley Lights vs. Kite Realty Group | Berkeley Lights vs. Stepstone Group |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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