Correlation Between St Elmo and BRP
Can any of the company-specific risk be diversified away by investing in both St Elmo and BRP 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 St Elmo and BRP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between St Elmo Silver and BRP Inc, you can compare the effects of market volatilities on St Elmo and BRP 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 St Elmo with a short position of BRP. Check out your portfolio center. Please also check ongoing floating volatility patterns of St Elmo and BRP.
Diversification Opportunities for St Elmo and BRP
Pay attention - limited upside
The 3 months correlation between STLM and BRP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding St Elmo Silver and BRP Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRP Inc and St Elmo 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 St Elmo Silver are associated (or correlated) with BRP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRP Inc has no effect on the direction of St Elmo i.e., St Elmo and BRP go up and down completely randomly.
Pair Corralation between St Elmo and BRP
If you would invest 0.00 in St Elmo Silver on November 22, 2024 and sell it today you would earn a total of 0.00 from holding St Elmo Silver or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 1.72% |
Values | Daily Returns |
St Elmo Silver vs. BRP Inc
Performance |
Timeline |
St Elmo Silver |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
BRP Inc |
St Elmo and BRP Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with St Elmo and BRP
The main advantage of trading using opposite St Elmo and BRP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if St Elmo position performs unexpectedly, BRP 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 BRP will offset losses from the drop in BRP's long position.St Elmo vs. Norfolk Southern | ||
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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