Correlation Between Chia and Berkem Group

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

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

Diversification Opportunities for Chia and Berkem Group

0.48

Correlation Coefficient

Chia  Berkem Group

Very weak diversification

The 3 months correlation between Chia and Berkem is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Chia and Berkem Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkem Group SA and Chia 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 Chia are associated (or correlated) with Berkem Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berkem Group SA has no effect on the direction of Chia i.e., Chia and Berkem Group go up and down completely randomly.

Pair Corralation between Chia and Berkem Group

Assuming the 90 days trading horizon Chia is expected to under-perform the Berkem Group. In addition to that, Chia is 48.91 times more volatile than Berkem Group SA. It trades about -0.16 of its total potential returns per unit of risk. Berkem Group SA is currently generating about 0.0 per unit of volatility. If you would invest  310.00  in Berkem Group SA on October 11, 2024 and sell it today you would earn a total of  0.00  from holding Berkem Group SA or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	90.48%
Values	Daily Returns

Chia  vs.  Berkem Group SA

Chia

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Chia are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical indicators, Chia exhibited solid returns over the last few months and may actually be approaching a breakup point.

Berkem Group SA

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Berkem Group SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Berkem Group is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Chia and Berkem Group

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

The idea behind Chia and Berkem Group SA 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.