Correlation Between Supply@Me Capital and BH Macro
Can any of the company-specific risk be diversified away by investing in both Supply@Me Capital and BH Macro 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 Supply@Me Capital and BH Macro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SupplyMe Capital PLC and BH Macro Limited, you can compare the effects of market volatilities on Supply@Me Capital and BH Macro 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 Supply@Me Capital with a short position of BH Macro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supply@Me Capital and BH Macro.
Diversification Opportunities for Supply@Me Capital and BH Macro
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Supply@Me and BHMG is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding SupplyMe Capital PLC and BH Macro Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BH Macro Limited and Supply@Me Capital 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 SupplyMe Capital PLC are associated (or correlated) with BH Macro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BH Macro Limited has no effect on the direction of Supply@Me Capital i.e., Supply@Me Capital and BH Macro go up and down completely randomly.
Pair Corralation between Supply@Me Capital and BH Macro
Assuming the 90 days trading horizon SupplyMe Capital PLC is expected to under-perform the BH Macro. In addition to that, Supply@Me Capital is 7.35 times more volatile than BH Macro Limited. It trades about -0.04 of its total potential returns per unit of risk. BH Macro Limited is currently generating about 0.26 per unit of volatility. If you would invest 37,200 in BH Macro Limited on August 29, 2024 and sell it today you would earn a total of 3,000 from holding BH Macro Limited or generate 8.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SupplyMe Capital PLC vs. BH Macro Limited
Performance |
| Timeline |
| SupplyMe Capital PLC |
| BH Macro Limited |
Supply@Me Capital and BH Macro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supply@Me Capital and BH Macro
The main advantage of trading using opposite Supply@Me Capital and BH Macro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supply@Me Capital position performs unexpectedly, BH Macro 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 BH Macro will offset losses from the drop in BH Macro's long position.| Supply@Me Capital vs. Alaska Air Group | Supply@Me Capital vs. Delta Air Lines | Supply@Me Capital vs. Deltex Medical Group | Supply@Me Capital vs. Finnair Oyj |
| BH Macro vs. Fortune Brands Home | BH Macro vs. OneSavings Bank PLC | BH Macro vs. Pacific Horizon Investment | BH Macro vs. Cairn Homes PLC |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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