Correlation Between BCE and WESTAR
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By analyzing existing cross correlation between BCE Inc and WESTAR ENERGY INC, you can compare the effects of market volatilities on BCE and WESTAR 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 BCE with a short position of WESTAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of BCE and WESTAR.
Diversification Opportunities for BCE and WESTAR
Very good diversification
The 3 months correlation between BCE and WESTAR is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding BCE Inc and WESTAR ENERGY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WESTAR ENERGY INC and BCE 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 BCE Inc are associated (or correlated) with WESTAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WESTAR ENERGY INC has no effect on the direction of BCE i.e., BCE and WESTAR go up and down completely randomly.
Pair Corralation between BCE and WESTAR
Considering the 90-day investment horizon BCE Inc is expected to under-perform the WESTAR. But the stock apears to be less risky and, when comparing its historical volatility, BCE Inc is 2.96 times less risky than WESTAR. The stock trades about -0.12 of its potential returns per unit of risk. The WESTAR ENERGY INC is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 8,483 in WESTAR ENERGY INC on December 1, 2024 and sell it today you would lose (158.00) from holding WESTAR ENERGY INC or give up 1.86% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 28.33% |
Values | Daily Returns |
BCE Inc vs. WESTAR ENERGY INC
Performance |
Timeline |
BCE Inc |
WESTAR ENERGY INC |
BCE and WESTAR Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BCE and WESTAR
The main advantage of trading using opposite BCE and WESTAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BCE position performs unexpectedly, WESTAR 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 WESTAR will offset losses from the drop in WESTAR's long position.BCE vs. Rogers Communications | BCE vs. America Movil SAB | BCE vs. Telus Corp | BCE vs. Telefonica Brasil SA |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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