Correlation Between BigBen Interactive and Delfingen

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

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

Diversification Opportunities for BigBen Interactive and Delfingen

0.73

Correlation Coefficient

BigBen Interactive  Delfingen

Poor diversification

The 3 months correlation between BigBen and Delfingen is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding BigBen Interactive and Delfingen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delfingen and BigBen Interactive 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 BigBen Interactive are associated (or correlated) with Delfingen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delfingen has no effect on the direction of BigBen Interactive i.e., BigBen Interactive and Delfingen go up and down completely randomly.

Pair Corralation between BigBen Interactive and Delfingen

Assuming the 90 days trading horizon BigBen Interactive is expected to generate 0.79 times more return on investment than Delfingen. However, BigBen Interactive is 1.26 times less risky than Delfingen. It trades about -0.16 of its potential returns per unit of risk. Delfingen is currently generating about -0.23 per unit of risk. If you would invest  223.00  in BigBen Interactive on September 30, 2024 and sell it today you would lose (87.00) from holding BigBen Interactive or give up 39.01% of portfolio value over 90 days.

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

BigBen Interactive  vs.  Delfingen

BigBen Interactive

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BigBen Interactive has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Delfingen

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Delfingen 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 January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with BigBen Interactive and Delfingen

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

The idea behind BigBen Interactive and Delfingen 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.