Correlation Between Electra Battery and BLUERUSH Media
Can any of the company-specific risk be diversified away by investing in both Electra Battery and BLUERUSH Media 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 Electra Battery and BLUERUSH Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electra Battery Materials and BLUERUSH Media Group, you can compare the effects of market volatilities on Electra Battery and BLUERUSH Media 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 Electra Battery with a short position of BLUERUSH Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electra Battery and BLUERUSH Media.
Diversification Opportunities for Electra Battery and BLUERUSH Media
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Electra and BLUERUSH is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Electra Battery Materials and BLUERUSH Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLUERUSH Media Group and Electra Battery 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 Electra Battery Materials are associated (or correlated) with BLUERUSH Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLUERUSH Media Group has no effect on the direction of Electra Battery i.e., Electra Battery and BLUERUSH Media go up and down completely randomly.
Pair Corralation between Electra Battery and BLUERUSH Media
Assuming the 90 days trading horizon Electra Battery is expected to generate 13.87 times less return on investment than BLUERUSH Media. But when comparing it to its historical volatility, Electra Battery Materials is 3.59 times less risky than BLUERUSH Media. It trades about 0.02 of its potential returns per unit of risk. BLUERUSH Media Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2.00 in BLUERUSH Media Group on September 25, 2024 and sell it today you would lose (1.00) from holding BLUERUSH Media Group or give up 50.0% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Electra Battery Materials vs. BLUERUSH Media Group
Performance |
Timeline |
Electra Battery Materials |
BLUERUSH Media Group |
Electra Battery and BLUERUSH Media Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Electra Battery and BLUERUSH Media
The main advantage of trading using opposite Electra Battery and BLUERUSH Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electra Battery position performs unexpectedly, BLUERUSH Media 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 BLUERUSH Media will offset losses from the drop in BLUERUSH Media's long position.Electra Battery vs. Frontier Lithium | Electra Battery vs. Electra Battery Materials | Electra Battery vs. E3 Lithium | Electra Battery vs. Canada Nickel |
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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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