Correlation Between Bilibili and Blue Hat

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

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

Diversification Opportunities for Bilibili and Blue Hat

-0.3

Correlation Coefficient

Bilibili  Blue Hat

Very good diversification

The 3 months correlation between Bilibili and Blue is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Bilibili and Blue Hat Interactive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Hat Interactive and Bilibili 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 Bilibili are associated (or correlated) with Blue Hat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Hat Interactive has no effect on the direction of Bilibili i.e., Bilibili and Blue Hat go up and down completely randomly.

Pair Corralation between Bilibili and Blue Hat

Given the investment horizon of 90 days Bilibili is expected to generate 0.86 times more return on investment than Blue Hat. However, Bilibili is 1.16 times less risky than Blue Hat. It trades about 0.1 of its potential returns per unit of risk. Blue Hat Interactive is currently generating about -0.21 per unit of risk. If you would invest  1,461  in Bilibili on September 3, 2024 and sell it today you would earn a total of  456.00  from holding Bilibili or generate 31.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Bilibili  vs.  Blue Hat Interactive

Bilibili

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bilibili are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak essential indicators, Bilibili demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Blue Hat Interactive

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blue Hat Interactive has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Bilibili and Blue Hat

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

The idea behind Bilibili and Blue Hat Interactive 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.

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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.