Correlation Between Where Food and Bm Technologies

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

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

Diversification Opportunities for Where Food and Bm Technologies

-0.19

Correlation Coefficient

Where Food  Bm Technologies

Good diversification

The 3 months correlation between Where and BMTX is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Where Food Comes and Bm Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bm Technologies and Where Food 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 Where Food Comes are associated (or correlated) with Bm Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bm Technologies has no effect on the direction of Where Food i.e., Where Food and Bm Technologies go up and down completely randomly.

Pair Corralation between Where Food and Bm Technologies

Given the investment horizon of 90 days Where Food is expected to generate 1.24 times less return on investment than Bm Technologies. In addition to that, Where Food is 4.95 times more volatile than Bm Technologies. It trades about 0.03 of its total potential returns per unit of risk. Bm Technologies is currently generating about 0.18 per unit of volatility. If you would invest  478.00  in Bm Technologies on November 29, 2024 and sell it today you would earn a total of  22.00  from holding Bm Technologies or generate 4.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	72.88%
Values	Daily Returns

Where Food Comes  vs.  Bm Technologies

Where Food Comes

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Where Food Comes are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable fundamental indicators, Where Food is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Bm Technologies

Risk-Adjusted Performance

Good

Over the last 90 days Bm Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly weak basic indicators, Bm Technologies may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with Where Food and Bm Technologies

The main advantage of trading using opposite Where Food and Bm Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Where Food position performs unexpectedly, Bm 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 Bm Technologies will offset losses from the drop in Bm Technologies' long position.

The idea behind Where Food Comes and Bm 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.