Correlation Between Raubex and Bytes Technology
Can any of the company-specific risk be diversified away by investing in both Raubex and Bytes Technology 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 Raubex and Bytes Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raubex and Bytes Technology, you can compare the effects of market volatilities on Raubex and Bytes Technology 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 Raubex with a short position of Bytes Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raubex and Bytes Technology.
Diversification Opportunities for Raubex and Bytes Technology
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Raubex and Bytes is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Raubex and Bytes Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bytes Technology and Raubex 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 Raubex are associated (or correlated) with Bytes Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bytes Technology has no effect on the direction of Raubex i.e., Raubex and Bytes Technology go up and down completely randomly.
Pair Corralation between Raubex and Bytes Technology
Assuming the 90 days trading horizon Raubex is expected to generate 1.1 times more return on investment than Bytes Technology. However, Raubex is 1.1 times more volatile than Bytes Technology. It trades about 0.11 of its potential returns per unit of risk. Bytes Technology is currently generating about -0.22 per unit of risk. If you would invest 510,672 in Raubex on September 26, 2024 and sell it today you would earn a total of 14,328 from holding Raubex or generate 2.81% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Raubex vs. Bytes Technology
Performance |
Timeline |
Raubex |
Bytes Technology |
Raubex and Bytes Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Raubex and Bytes Technology
The main advantage of trading using opposite Raubex and Bytes Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raubex position performs unexpectedly, Bytes Technology 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 Bytes Technology will offset losses from the drop in Bytes Technology's long position.Raubex vs. Bytes Technology | Raubex vs. Lesaka Technologies | Raubex vs. Frontier Transport Holdings | Raubex vs. Trematon Capital Investments |
Bytes Technology vs. ISA Holdings | Bytes Technology vs. Thungela Resources Limited | Bytes Technology vs. Pepkor Holdings | Bytes Technology vs. We Buy Cars |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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