Correlation Between Barunson Entertainment and PH Tech

Can any of the company-specific risk be diversified away by investing in both Barunson Entertainment and PH Tech 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 Barunson Entertainment and PH Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Barunson Entertainment Arts and PH Tech Co, you can compare the effects of market volatilities on Barunson Entertainment and PH Tech 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 Barunson Entertainment with a short position of PH Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barunson Entertainment and PH Tech.

Diversification Opportunities for Barunson Entertainment and PH Tech

0.55

Correlation Coefficient

Barunson Entertainment  PH Tech

Very weak diversification

The 3 months correlation between Barunson and 239890 is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Barunson Entertainment Arts and PH Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PH Tech and Barunson Entertainment 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 Barunson Entertainment Arts are associated (or correlated) with PH Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PH Tech has no effect on the direction of Barunson Entertainment i.e., Barunson Entertainment and PH Tech go up and down completely randomly.

Pair Corralation between Barunson Entertainment and PH Tech

Assuming the 90 days trading horizon Barunson Entertainment Arts is expected to under-perform the PH Tech. But the stock apears to be less risky and, when comparing its historical volatility, Barunson Entertainment Arts is 1.29 times less risky than PH Tech. The stock trades about -0.06 of its potential returns per unit of risk. The PH Tech Co is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  1,480,000  in PH Tech Co on October 3, 2024 and sell it today you would lose (700,000) from holding PH Tech Co or give up 47.3% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Barunson Entertainment Arts  vs.  PH Tech Co

Barunson Entertainment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Barunson Entertainment Arts has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

PH Tech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PH Tech Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Barunson Entertainment and PH Tech

The main advantage of trading using opposite Barunson Entertainment and PH Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barunson Entertainment position performs unexpectedly, PH Tech 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 PH Tech will offset losses from the drop in PH Tech's long position.

The idea behind Barunson Entertainment Arts and PH Tech Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.