Correlation Between Intelsat and BCE
Can any of the company-specific risk be diversified away by investing in both Intelsat and BCE 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 Intelsat and BCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intelsat SA and BCE Inc, you can compare the effects of market volatilities on Intelsat and BCE 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 Intelsat with a short position of BCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intelsat and BCE.
Diversification Opportunities for Intelsat and BCE
Pay attention - limited upside
The 3 months correlation between Intelsat and BCE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Intelsat SA and BCE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCE Inc and Intelsat 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 Intelsat SA are associated (or correlated) with BCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCE Inc has no effect on the direction of Intelsat i.e., Intelsat and BCE go up and down completely randomly.
Pair Corralation between Intelsat and BCE
If you would invest (100.00) in Intelsat SA on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Intelsat SA or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Intelsat SA vs. BCE Inc
Performance |
| Timeline |
| Intelsat SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| BCE Inc |
Intelsat and BCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intelsat and BCE
The main advantage of trading using opposite Intelsat and BCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intelsat position performs unexpectedly, BCE 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 BCE will offset losses from the drop in BCE's long position.The idea behind Intelsat SA and BCE Inc 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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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