Correlation Between B Yair and Electreon Wireless

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

By analyzing existing cross correlation between B Yair Building and Electreon Wireless, you can compare the effects of market volatilities on B Yair and Electreon Wireless 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 B Yair with a short position of Electreon Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of B Yair and Electreon Wireless.

Diversification Opportunities for B Yair and Electreon Wireless

-0.44

Correlation Coefficient

B Yair  Electreon Wireless

Very good diversification

The 3 months correlation between BYAR and Electreon is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding B Yair Building and Electreon Wireless in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electreon Wireless and B Yair 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 B Yair Building are associated (or correlated) with Electreon Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electreon Wireless has no effect on the direction of B Yair i.e., B Yair and Electreon Wireless go up and down completely randomly.

Pair Corralation between B Yair and Electreon Wireless

Assuming the 90 days trading horizon B Yair Building is expected to generate 0.6 times more return on investment than Electreon Wireless. However, B Yair Building is 1.66 times less risky than Electreon Wireless. It trades about 0.15 of its potential returns per unit of risk. Electreon Wireless is currently generating about 0.09 per unit of risk. If you would invest  90,150  in B Yair Building on September 3, 2024 and sell it today you would earn a total of  17,450  from holding B Yair Building or generate 19.36% return on investment over 90 days.

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

B Yair Building  vs.  Electreon Wireless

B Yair Building

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in B Yair Building are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, B Yair sustained solid returns over the last few months and may actually be approaching a breakup point.

Electreon Wireless

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Electreon Wireless are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Electreon Wireless sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with B Yair and Electreon Wireless

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

The idea behind B Yair Building and Electreon Wireless 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.