Correlation Between United Breweries and Blue Coast
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By analyzing existing cross correlation between United Breweries Limited and Blue Coast Hotels, you can compare the effects of market volatilities on United Breweries and Blue Coast 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 United Breweries with a short position of Blue Coast. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Breweries and Blue Coast.
Diversification Opportunities for United Breweries and Blue Coast
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between United and Blue is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding United Breweries Limited and Blue Coast Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Coast Hotels and United Breweries 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 United Breweries Limited are associated (or correlated) with Blue Coast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Coast Hotels has no effect on the direction of United Breweries i.e., United Breweries and Blue Coast go up and down completely randomly.
Pair Corralation between United Breweries and Blue Coast
Assuming the 90 days trading horizon United Breweries Limited is expected to generate 0.98 times more return on investment than Blue Coast. However, United Breweries Limited is 1.03 times less risky than Blue Coast. It trades about 0.01 of its potential returns per unit of risk. Blue Coast Hotels is currently generating about 0.01 per unit of risk. If you would invest 195,290 in United Breweries Limited on September 4, 2024 and sell it today you would earn a total of 775.00 from holding United Breweries Limited or generate 0.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.81% |
| Values | Daily Returns |
United Breweries Limited vs. Blue Coast Hotels
Performance |
| Timeline |
| United Breweries |
| Blue Coast Hotels |
United Breweries and Blue Coast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Breweries and Blue Coast
The main advantage of trading using opposite United Breweries and Blue Coast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Breweries position performs unexpectedly, Blue Coast 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 Blue Coast will offset losses from the drop in Blue Coast's long position.| United Breweries vs. Ortel Communications Limited | United Breweries vs. Hathway Cable Datacom | United Breweries vs. Paramount Communications Limited | United Breweries vs. One 97 Communications |
| Blue Coast vs. EIH Associated Hotels | Blue Coast vs. Taj GVK Hotels | Blue Coast vs. Lemon Tree Hotels | Blue Coast vs. Generic Engineering Construction |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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