Correlation Between Technology One and Balkan Mining
Can any of the company-specific risk be diversified away by investing in both Technology One and Balkan Mining 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 Technology One and Balkan Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Technology One and Balkan Mining and, you can compare the effects of market volatilities on Technology One and Balkan Mining 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 Technology One with a short position of Balkan Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Technology One and Balkan Mining.
Diversification Opportunities for Technology One and Balkan Mining
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Technology and Balkan is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Technology One and Balkan Mining and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Balkan Mining and Technology One 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 Technology One are associated (or correlated) with Balkan Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Balkan Mining has no effect on the direction of Technology One i.e., Technology One and Balkan Mining go up and down completely randomly.
Pair Corralation between Technology One and Balkan Mining
Assuming the 90 days trading horizon Technology One is expected to generate 45.25 times less return on investment than Balkan Mining. But when comparing it to its historical volatility, Technology One is 1.45 times less risky than Balkan Mining. It trades about 0.0 of its potential returns per unit of risk. Balkan Mining and is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 5.10 in Balkan Mining and on November 5, 2024 and sell it today you would earn a total of 0.00 from holding Balkan Mining and or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Technology One vs. Balkan Mining and
Performance |
| Timeline |
| Technology One |
| Balkan Mining |
Technology One and Balkan Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Technology One and Balkan Mining
The main advantage of trading using opposite Technology One and Balkan Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Technology One position performs unexpectedly, Balkan Mining 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 Balkan Mining will offset losses from the drop in Balkan Mining's long position.| Technology One vs. Credit Clear | Technology One vs. Perpetual Credit Income | Technology One vs. WiseTech Global Limited | Technology One vs. Epsilon Healthcare |
| Balkan Mining vs. Air New Zealand | Balkan Mining vs. Kkr Credit Income | Balkan Mining vs. The Environmental Group | Balkan Mining vs. Aeris Environmental |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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