Correlation Between BK Technologies and Zhihu
Can any of the company-specific risk be diversified away by investing in both BK Technologies and Zhihu 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 Zhihu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BK Technologies and Zhihu Inc ADR, you can compare the effects of market volatilities on BK Technologies and Zhihu 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 Zhihu. Check out your portfolio center. Please also check ongoing floating volatility patterns of BK Technologies and Zhihu.
Diversification Opportunities for BK Technologies and Zhihu
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BKTI and Zhihu is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding BK Technologies and Zhihu Inc ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhihu Inc ADR 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 Zhihu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhihu Inc ADR has no effect on the direction of BK Technologies i.e., BK Technologies and Zhihu go up and down completely randomly.
Pair Corralation between BK Technologies and Zhihu
Given the investment horizon of 90 days BK Technologies is expected to generate 10.92 times less return on investment than Zhihu. In addition to that, BK Technologies is 1.11 times more volatile than Zhihu Inc ADR. It trades about 0.01 of its total potential returns per unit of risk. Zhihu Inc ADR is currently generating about 0.15 per unit of volatility. If you would invest 368.00 in Zhihu Inc ADR on December 18, 2024 and sell it today you would earn a total of 153.00 from holding Zhihu Inc ADR or generate 41.58% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
BK Technologies vs. Zhihu Inc ADR
Performance |
Timeline |
BK Technologies |
Zhihu Inc ADR |
BK Technologies and Zhihu Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BK Technologies and Zhihu
The main advantage of trading using opposite BK Technologies and Zhihu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BK Technologies position performs unexpectedly, Zhihu 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 Zhihu will offset losses from the drop in Zhihu's long position.BK Technologies vs. Frequency Electronics | BK Technologies vs. Actelis Networks | BK Technologies vs. Optical Cable | BK Technologies vs. Baylin Technologies |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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