Correlation Between BHP Group and Wineco Productions
Can any of the company-specific risk be diversified away by investing in both BHP Group and Wineco Productions 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 BHP Group and Wineco Productions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BHP Group Limited and Wineco Productions, you can compare the effects of market volatilities on BHP Group and Wineco Productions 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 BHP Group with a short position of Wineco Productions. Check out your portfolio center. Please also check ongoing floating volatility patterns of BHP Group and Wineco Productions.
Diversification Opportunities for BHP Group and Wineco Productions
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BHP and Wineco is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BHP Group Limited and Wineco Productions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wineco Productions and BHP Group 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 BHP Group Limited are associated (or correlated) with Wineco Productions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wineco Productions has no effect on the direction of BHP Group i.e., BHP Group and Wineco Productions go up and down completely randomly.
Pair Corralation between BHP Group and Wineco Productions
If you would invest 5,655 in BHP Group Limited on January 26, 2024 and sell it today you would earn a total of 269.00 from holding BHP Group Limited or generate 4.76% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
BHP Group Limited vs. Wineco Productions
Performance |
Timeline |
BHP Group Limited |
Wineco Productions |
BHP Group and Wineco Productions Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BHP Group and Wineco Productions
The main advantage of trading using opposite BHP Group and Wineco Productions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BHP Group position performs unexpectedly, Wineco Productions 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 Wineco Productions will offset losses from the drop in Wineco Productions' long position.BHP Group vs. ZincX Resources Corp | BHP Group vs. Mundoro Capital | BHP Group vs. Strategic Resources | BHP Group vs. Norra Metals Corp |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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