Correlation Between Virgin Wines and Bankers Investment
Can any of the company-specific risk be diversified away by investing in both Virgin Wines and Bankers Investment 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 Virgin Wines and Bankers Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virgin Wines UK and Bankers Investment Trust, you can compare the effects of market volatilities on Virgin Wines and Bankers Investment 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 Virgin Wines with a short position of Bankers Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virgin Wines and Bankers Investment.
Diversification Opportunities for Virgin Wines and Bankers Investment
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Virgin and Bankers is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Virgin Wines UK and Bankers Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bankers Investment Trust and Virgin Wines 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 Virgin Wines UK are associated (or correlated) with Bankers Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bankers Investment Trust has no effect on the direction of Virgin Wines i.e., Virgin Wines and Bankers Investment go up and down completely randomly.
Pair Corralation between Virgin Wines and Bankers Investment
Assuming the 90 days trading horizon Virgin Wines UK is expected to under-perform the Bankers Investment. In addition to that, Virgin Wines is 2.74 times more volatile than Bankers Investment Trust. It trades about -0.03 of its total potential returns per unit of risk. Bankers Investment Trust is currently generating about 0.05 per unit of volatility. If you would invest 9,706 in Bankers Investment Trust on September 3, 2024 and sell it today you would earn a total of 1,934 from holding Bankers Investment Trust or generate 19.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Virgin Wines UK vs. Bankers Investment Trust
Performance |
| Timeline |
| Virgin Wines UK |
| Bankers Investment Trust |
Virgin Wines and Bankers Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virgin Wines and Bankers Investment
The main advantage of trading using opposite Virgin Wines and Bankers Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virgin Wines position performs unexpectedly, Bankers Investment 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 Bankers Investment will offset losses from the drop in Bankers Investment's long position.| Virgin Wines vs. National Atomic Co | Virgin Wines vs. Flutter Entertainment PLC | Virgin Wines vs. Camellia Plc | Virgin Wines vs. Marwyn Value Investors |
| Bankers Investment vs. Verizon Communications | Bankers Investment vs. JD Sports Fashion | Bankers Investment vs. Silvercorp Metals | Bankers Investment vs. Gaztransport et Technigaz |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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