Correlation Between DY6 Metals and Bendigo
Can any of the company-specific risk be diversified away by investing in both DY6 Metals and Bendigo 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 DY6 Metals and Bendigo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DY6 Metals and Bendigo And Adelaide, you can compare the effects of market volatilities on DY6 Metals and Bendigo 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 DY6 Metals with a short position of Bendigo. Check out your portfolio center. Please also check ongoing floating volatility patterns of DY6 Metals and Bendigo.
Diversification Opportunities for DY6 Metals and Bendigo
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DY6 and Bendigo is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding DY6 Metals and Bendigo And Adelaide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bendigo And Adelaide and DY6 Metals 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 DY6 Metals are associated (or correlated) with Bendigo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bendigo And Adelaide has no effect on the direction of DY6 Metals i.e., DY6 Metals and Bendigo go up and down completely randomly.
Pair Corralation between DY6 Metals and Bendigo
Assuming the 90 days trading horizon DY6 Metals is expected to under-perform the Bendigo. In addition to that, DY6 Metals is 2.22 times more volatile than Bendigo And Adelaide. It trades about -0.1 of its total potential returns per unit of risk. Bendigo And Adelaide is currently generating about -0.13 per unit of volatility. If you would invest 1,354 in Bendigo And Adelaide on October 4, 2024 and sell it today you would lose (44.00) from holding Bendigo And Adelaide or give up 3.25% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
DY6 Metals vs. Bendigo And Adelaide
Performance |
Timeline |
DY6 Metals |
Bendigo And Adelaide |
DY6 Metals and Bendigo Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with DY6 Metals and Bendigo
The main advantage of trading using opposite DY6 Metals and Bendigo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DY6 Metals position performs unexpectedly, Bendigo 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 Bendigo will offset losses from the drop in Bendigo's long position.DY6 Metals vs. Northern Star Resources | DY6 Metals vs. Evolution Mining | DY6 Metals vs. Bluescope Steel | DY6 Metals vs. Sandfire Resources NL |
Bendigo vs. Regis Healthcare | Bendigo vs. Queste Communications | Bendigo vs. Fisher Paykel Healthcare | Bendigo vs. Vulcan Steel |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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