Correlation Between Bell Financial and Brambles

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

By analyzing existing cross correlation between Bell Financial Group and Brambles, you can compare the effects of market volatilities on Bell Financial and Brambles 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 Bell Financial with a short position of Brambles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bell Financial and Brambles.

Diversification Opportunities for Bell Financial and Brambles

-0.24

Correlation Coefficient

Bell Financial  Brambles

Very good diversification

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

Pair Corralation between Bell Financial and Brambles

Assuming the 90 days trading horizon Bell Financial Group is expected to under-perform the Brambles. In addition to that, Bell Financial is 1.14 times more volatile than Brambles. It trades about -0.05 of its total potential returns per unit of risk. Brambles is currently generating about 0.12 per unit of volatility. If you would invest  1,879  in Brambles on December 20, 2024 and sell it today you would earn a total of  133.00  from holding Brambles or generate 7.08% return on investment over 90 days.

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

Bell Financial Group  vs.  Brambles

Bell Financial Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bell Financial Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Bell Financial is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Brambles

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Brambles are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain fundamental drivers, Brambles may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Bell Financial and Brambles

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

The idea behind Bell Financial Group and Brambles 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.