Correlation Between BPS TECHNOLOGY and Porn Prom

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

By analyzing existing cross correlation between BPS TECHNOLOGY PUBLIC and Porn Prom Metal, you can compare the effects of market volatilities on BPS TECHNOLOGY and Porn Prom 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 BPS TECHNOLOGY with a short position of Porn Prom. Check out your portfolio center. Please also check ongoing floating volatility patterns of BPS TECHNOLOGY and Porn Prom.

Diversification Opportunities for BPS TECHNOLOGY and Porn Prom

-0.66

Correlation Coefficient

BPS TECHNOLOGY  Porn Prom

Excellent diversification

The 3 months correlation between BPS and Porn is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding BPS TECHNOLOGY PUBLIC and Porn Prom Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Porn Prom Metal and BPS TECHNOLOGY 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 BPS TECHNOLOGY PUBLIC are associated (or correlated) with Porn Prom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Porn Prom Metal has no effect on the direction of BPS TECHNOLOGY i.e., BPS TECHNOLOGY and Porn Prom go up and down completely randomly.

Pair Corralation between BPS TECHNOLOGY and Porn Prom

Assuming the 90 days trading horizon BPS TECHNOLOGY PUBLIC is expected to under-perform the Porn Prom. But the stock apears to be less risky and, when comparing its historical volatility, BPS TECHNOLOGY PUBLIC is 1.34 times less risky than Porn Prom. The stock trades about -0.03 of its potential returns per unit of risk. The Porn Prom Metal is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  150.00  in Porn Prom Metal on December 19, 2024 and sell it today you would earn a total of  30.00  from holding Porn Prom Metal or generate 20.0% return on investment over 90 days.

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

BPS TECHNOLOGY PUBLIC  vs.  Porn Prom Metal

BPS TECHNOLOGY PUBLIC

Risk-Adjusted Performance

Very Weak

Over the last 90 days BPS TECHNOLOGY PUBLIC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, BPS TECHNOLOGY is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Porn Prom Metal

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Porn Prom Metal are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak primary indicators, Porn Prom disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BPS TECHNOLOGY and Porn Prom

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

The idea behind BPS TECHNOLOGY PUBLIC and Porn Prom Metal 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.