Correlation Between Bayport International and International Land

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

By analyzing existing cross correlation between Bayport International Holdings and International Land Alliance, you can compare the effects of market volatilities on Bayport International and International Land 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 Bayport International with a short position of International Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bayport International and International Land.

Diversification Opportunities for Bayport International and International Land

-0.24

Correlation Coefficient

Bayport International  International Land

Very good diversification

The 3 months correlation between Bayport and International is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Bayport International Holdings and International Land Alliance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Land and Bayport International 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 Bayport International Holdings are associated (or correlated) with International Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Land has no effect on the direction of Bayport International i.e., Bayport International and International Land go up and down completely randomly.

Pair Corralation between Bayport International and International Land

Given the investment horizon of 90 days Bayport International Holdings is expected to generate 4.46 times more return on investment than International Land. However, Bayport International is 4.46 times more volatile than International Land Alliance. It trades about 0.06 of its potential returns per unit of risk. International Land Alliance is currently generating about 0.07 per unit of risk. If you would invest  0.02  in Bayport International Holdings on October 7, 2024 and sell it today you would lose (0.01) from holding Bayport International Holdings or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Bayport International Holdings  vs.  International Land Alliance

Bayport International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bayport International Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

International Land

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in International Land Alliance are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, International Land disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bayport International and International Land

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

The idea behind Bayport International Holdings and International Land Alliance 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.