Correlation Between BK Technologies and Metalert

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

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

Diversification Opportunities for BK Technologies and Metalert

0.61

Correlation Coefficient

BK Technologies  Metalert

Poor diversification

The 3 months correlation between BKTI and Metalert is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding BK Technologies and Metalert in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metalert and BK Technologies 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 BK Technologies are associated (or correlated) with Metalert. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metalert has no effect on the direction of BK Technologies i.e., BK Technologies and Metalert go up and down completely randomly.

Pair Corralation between BK Technologies and Metalert

Given the investment horizon of 90 days BK Technologies is expected to generate 0.58 times more return on investment than Metalert. However, BK Technologies is 1.73 times less risky than Metalert. It trades about 0.03 of its potential returns per unit of risk. Metalert is currently generating about -0.12 per unit of risk. If you would invest  3,491  in BK Technologies on December 28, 2024 and sell it today you would earn a total of  109.00  from holding BK Technologies or generate 3.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

BK Technologies  vs.  Metalert

BK Technologies

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BK Technologies are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, BK Technologies may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Metalert

Risk-Adjusted Performance

Very Weak

Over the last 90 days Metalert has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with BK Technologies and Metalert

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

The idea behind BK Technologies and Metalert 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 Stocks Directory module to find actively traded stocks across global markets.