Correlation Between BANK CENTRAL and UR ENERGY

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

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

Diversification Opportunities for BANK CENTRAL and UR ENERGY

0.92

Correlation Coefficient

BANK CENTRAL  UR ENERGY

Almost no diversification

The 3 months correlation between BANK and U9T is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding BANK CENTRAL ASIA and UR ENERGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UR ENERGY and BANK CENTRAL 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 BANK CENTRAL ASIA are associated (or correlated) with UR ENERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UR ENERGY has no effect on the direction of BANK CENTRAL i.e., BANK CENTRAL and UR ENERGY go up and down completely randomly.

Pair Corralation between BANK CENTRAL and UR ENERGY

Assuming the 90 days trading horizon BANK CENTRAL ASIA is expected to generate 0.45 times more return on investment than UR ENERGY. However, BANK CENTRAL ASIA is 2.24 times less risky than UR ENERGY. It trades about -0.23 of its potential returns per unit of risk. UR ENERGY is currently generating about -0.16 per unit of risk. If you would invest  60.00  in BANK CENTRAL ASIA on December 20, 2024 and sell it today you would lose (12.00) from holding BANK CENTRAL ASIA or give up 20.0% of portfolio value over 90 days.

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

BANK CENTRAL ASIA  vs.  UR ENERGY

BANK CENTRAL ASIA

Risk-Adjusted Performance

Very Weak

Over the last 90 days BANK CENTRAL ASIA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile 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.

UR ENERGY

Risk-Adjusted Performance

Very Weak

Over the last 90 days UR ENERGY has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile 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 BANK CENTRAL and UR ENERGY

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

The idea behind BANK CENTRAL ASIA and UR ENERGY 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..