Correlation Between United Hero and BCAP Mid
Can any of the company-specific risk be diversified away by investing in both United Hero and BCAP Mid 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 United Hero and BCAP Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Hero ETF and BCAP Mid Small, you can compare the effects of market volatilities on United Hero and BCAP Mid 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 Hero with a short position of BCAP Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Hero and BCAP Mid.
Diversification Opportunities for United Hero and BCAP Mid
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between United and BCAP is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding United Hero ETF and BCAP Mid Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCAP Mid Small and United Hero 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 Hero ETF are associated (or correlated) with BCAP Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCAP Mid Small has no effect on the direction of United Hero i.e., United Hero and BCAP Mid go up and down completely randomly.
Pair Corralation between United Hero and BCAP Mid
Assuming the 90 days trading horizon United Hero ETF is expected to generate 182.1 times more return on investment than BCAP Mid. However, United Hero is 182.1 times more volatile than BCAP Mid Small. It trades about 0.18 of its potential returns per unit of risk. BCAP Mid Small is currently generating about -0.06 per unit of risk. If you would invest 732.00 in United Hero ETF on August 29, 2024 and sell it today you would earn a total of 83.00 from holding United Hero ETF or generate 11.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.19% |
| Values | Daily Returns |
United Hero ETF vs. BCAP Mid Small
Performance |
| Timeline |
| United Hero ETF |
| BCAP Mid Small |
United Hero and BCAP Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Hero and BCAP Mid
The main advantage of trading using opposite United Hero and BCAP Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Hero position performs unexpectedly, BCAP Mid 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 BCAP Mid will offset losses from the drop in BCAP Mid's long position.| United Hero vs. ThaiDex SET50 Exchange | United Hero vs. BCAP MSCI Thailand | United Hero vs. BCAP SET100 | United Hero vs. KTAM Gold ETF |
| BCAP Mid vs. BCAP SET100 | BCAP Mid vs. BCAP MSCI Thailand | BCAP Mid vs. United Hero ETF | BCAP Mid vs. WISE KTAM CSI |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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