Correlation Between Chinese Maritime and Brogent Technologies

Can any of the company-specific risk be diversified away by investing in both Chinese Maritime and Brogent Technologies 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 Chinese Maritime and Brogent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Chinese Maritime Transport and Brogent Technologies, you can compare the effects of market volatilities on Chinese Maritime and Brogent Technologies 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 Chinese Maritime with a short position of Brogent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chinese Maritime and Brogent Technologies.

Diversification Opportunities for Chinese Maritime and Brogent Technologies

0.49

Correlation Coefficient

Chinese Maritime  Brogent Technologies

Very weak diversification

The 3 months correlation between Chinese and Brogent is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Chinese Maritime Transport and Brogent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brogent Technologies and Chinese Maritime 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 Chinese Maritime Transport are associated (or correlated) with Brogent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brogent Technologies has no effect on the direction of Chinese Maritime i.e., Chinese Maritime and Brogent Technologies go up and down completely randomly.

Pair Corralation between Chinese Maritime and Brogent Technologies

Assuming the 90 days trading horizon Chinese Maritime Transport is expected to under-perform the Brogent Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Chinese Maritime Transport is 1.57 times less risky than Brogent Technologies. The stock trades about -0.02 of its potential returns per unit of risk. The Brogent Technologies is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  11,350  in Brogent Technologies on October 9, 2024 and sell it today you would earn a total of  3,200  from holding Brogent Technologies or generate 28.19% return on investment over 90 days.

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

Chinese Maritime Transport  vs.  Brogent Technologies

Chinese Maritime Tra

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Chinese Maritime Transport has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Brogent Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brogent Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Chinese Maritime and Brogent Technologies

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

The idea behind Chinese Maritime Transport and Brogent Technologies 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.

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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.