Correlation Between Odyssey Energy and Bendigo
Can any of the company-specific risk be diversified away by investing in both Odyssey Energy 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 Odyssey Energy and Bendigo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Odyssey Energy and Bendigo And Adelaide, you can compare the effects of market volatilities on Odyssey Energy 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 Odyssey Energy with a short position of Bendigo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Odyssey Energy and Bendigo.
Diversification Opportunities for Odyssey Energy and Bendigo
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Odyssey and Bendigo is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Odyssey Energy 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 Odyssey Energy 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 Odyssey Energy 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 Odyssey Energy i.e., Odyssey Energy and Bendigo go up and down completely randomly.
Pair Corralation between Odyssey Energy and Bendigo
Assuming the 90 days trading horizon Odyssey Energy is expected to generate 3.5 times less return on investment than Bendigo. In addition to that, Odyssey Energy is 5.37 times more volatile than Bendigo And Adelaide. It trades about 0.0 of its total potential returns per unit of risk. Bendigo And Adelaide is currently generating about 0.08 per unit of volatility. If you would invest 870.00 in Bendigo And Adelaide on September 26, 2024 and sell it today you would earn a total of 448.00 from holding Bendigo And Adelaide or generate 51.49% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 99.8% |
Values | Daily Returns |
Odyssey Energy vs. Bendigo And Adelaide
Performance |
Timeline |
Odyssey Energy |
Bendigo And Adelaide |
Odyssey Energy and Bendigo Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Odyssey Energy and Bendigo
The main advantage of trading using opposite Odyssey Energy and Bendigo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Odyssey Energy 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.Odyssey Energy vs. Microequities Asset Management | Odyssey Energy vs. MFF Capital Investments | Odyssey Energy vs. Hotel Property Investments | Odyssey Energy vs. Clime Investment Management |
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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.
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