Correlation Between Baylin Technologies and BK Technologies

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

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

Diversification Opportunities for Baylin Technologies and BK Technologies

0.59

Correlation Coefficient

Baylin Technologies  BK Technologies

Very weak diversification

The 3 months correlation between Baylin and BKTI is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Baylin Technologies and BK Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BK Technologies and Baylin 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 Baylin Technologies are associated (or correlated) with BK Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BK Technologies has no effect on the direction of Baylin Technologies i.e., Baylin Technologies and BK Technologies go up and down completely randomly.

Pair Corralation between Baylin Technologies and BK Technologies

Assuming the 90 days horizon Baylin Technologies is expected to under-perform the BK Technologies. But the otc stock apears to be less risky and, when comparing its historical volatility, Baylin Technologies is 1.29 times less risky than BK Technologies. The otc stock trades about -0.22 of its potential returns per unit of risk. The BK Technologies is currently generating about 0.03 of returns per unit of risk over similar time horizon. 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	Weak
Accuracy	95.31%
Values	Daily Returns

Baylin Technologies  vs.  BK Technologies

Baylin Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Baylin Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

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.

Pair Trading with Baylin Technologies and BK Technologies

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

The idea behind Baylin Technologies and BK Technologies 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.