Correlation Between BPS TECHNOLOGY and Vintcom Technology

Can any of the company-specific risk be diversified away by investing in both BPS TECHNOLOGY and Vintcom Technology 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 Vintcom Technology 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 Vintcom Technology PCL, you can compare the effects of market volatilities on BPS TECHNOLOGY and Vintcom Technology 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 Vintcom Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of BPS TECHNOLOGY and Vintcom Technology.

Diversification Opportunities for BPS TECHNOLOGY and Vintcom Technology

0.5

Correlation Coefficient

BPS TECHNOLOGY  Vintcom Technology

Very weak diversification

The 3 months correlation between BPS and Vintcom is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding BPS TECHNOLOGY PUBLIC and Vintcom Technology PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vintcom Technology PCL 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 Vintcom Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vintcom Technology PCL has no effect on the direction of BPS TECHNOLOGY i.e., BPS TECHNOLOGY and Vintcom Technology go up and down completely randomly.

Pair Corralation between BPS TECHNOLOGY and Vintcom Technology

Assuming the 90 days trading horizon BPS TECHNOLOGY PUBLIC is expected to under-perform the Vintcom Technology. In addition to that, BPS TECHNOLOGY is 1.95 times more volatile than Vintcom Technology PCL. It trades about 0.0 of its total potential returns per unit of risk. Vintcom Technology PCL is currently generating about 0.05 per unit of volatility. If you would invest  223.00  in Vintcom Technology PCL on December 21, 2024 and sell it today you would earn a total of  7.00  from holding Vintcom Technology PCL or generate 3.14% return on investment over 90 days.

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

BPS TECHNOLOGY PUBLIC  vs.  Vintcom Technology PCL

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.

Vintcom Technology PCL

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Vintcom Technology PCL are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Vintcom Technology is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with BPS TECHNOLOGY and Vintcom Technology

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

The idea behind BPS TECHNOLOGY PUBLIC and Vintcom Technology PCL 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.