Correlation Between Bell Financial and Retail Food
Can any of the company-specific risk be diversified away by investing in both Bell Financial and Retail Food 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 Retail Food 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 Retail Food Group, you can compare the effects of market volatilities on Bell Financial and Retail Food 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 Retail Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bell Financial and Retail Food.
Diversification Opportunities for Bell Financial and Retail Food
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bell and Retail is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Bell Financial Group and Retail Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retail Food Group 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 Retail Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retail Food Group has no effect on the direction of Bell Financial i.e., Bell Financial and Retail Food go up and down completely randomly.
Pair Corralation between Bell Financial and Retail Food
Assuming the 90 days trading horizon Bell Financial Group is expected to generate 0.35 times more return on investment than Retail Food. However, Bell Financial Group is 2.86 times less risky than Retail Food. It trades about -0.01 of its potential returns per unit of risk. Retail Food Group is currently generating about -0.1 per unit of risk. If you would invest 130.00 in Bell Financial Group on December 28, 2024 and sell it today you would lose (1.00) from holding Bell Financial Group or give up 0.77% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 98.41% |
Values | Daily Returns |
Bell Financial Group vs. Retail Food Group
Performance |
Timeline |
Bell Financial Group |
Retail Food Group |
Bell Financial and Retail Food Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bell Financial and Retail Food
The main advantage of trading using opposite Bell Financial and Retail Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bell Financial position performs unexpectedly, Retail Food 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 Retail Food will offset losses from the drop in Retail Food's long position.Bell Financial vs. Centrex Metals | Bell Financial vs. Sky Metals | Bell Financial vs. Australian Unity Office | Bell Financial vs. Qbe Insurance Group |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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