Correlation Between Maverix Metals and BK Technologies

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

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

Diversification Opportunities for Maverix Metals and BK Technologies

0.0

Correlation Coefficient

Maverix Metals  BK Technologies

Pay attention - limited upside

The 3 months correlation between Maverix and BKTI is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Maverix Metals and BK Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BK Technologies and Maverix 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 Maverix Metals 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 Maverix Metals i.e., Maverix Metals and BK Technologies go up and down completely randomly.

Pair Corralation between Maverix Metals and BK Technologies

If you would invest  0.00  in Maverix Metals on October 26, 2024 and sell it today you would earn a total of  0.00  from holding Maverix Metals or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.56%
Values	Daily Returns

Maverix Metals  vs.  BK Technologies

Maverix Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maverix Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong primary indicators, Maverix Metals is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

BK Technologies

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in BK Technologies are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, BK Technologies demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Maverix Metals and BK Technologies

The main advantage of trading using opposite Maverix Metals and BK Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maverix Metals 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 Maverix Metals 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.

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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.