Correlation Between 05526DBS3 and Brenmiller Energy

Can any of the company-specific risk be diversified away by investing in both 05526DBS3 and Brenmiller Energy 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 05526DBS3 and Brenmiller Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BAT CAPITAL P and Brenmiller Energy Ltd, you can compare the effects of market volatilities on 05526DBS3 and Brenmiller Energy 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 05526DBS3 with a short position of Brenmiller Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of 05526DBS3 and Brenmiller Energy.

Diversification Opportunities for 05526DBS3 and Brenmiller Energy

0.42

Correlation Coefficient

05526DBS3  Brenmiller Energy

Very weak diversification

The 3 months correlation between 05526DBS3 and Brenmiller is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding BAT CAPITAL P and Brenmiller Energy Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brenmiller Energy and 05526DBS3 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 BAT CAPITAL P are associated (or correlated) with Brenmiller Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brenmiller Energy has no effect on the direction of 05526DBS3 i.e., 05526DBS3 and Brenmiller Energy go up and down completely randomly.

Pair Corralation between 05526DBS3 and Brenmiller Energy

Assuming the 90 days trading horizon BAT CAPITAL P is expected to generate 0.15 times more return on investment than Brenmiller Energy. However, BAT CAPITAL P is 6.66 times less risky than Brenmiller Energy. It trades about -0.15 of its potential returns per unit of risk. Brenmiller Energy Ltd is currently generating about -0.06 per unit of risk. If you would invest  8,944  in BAT CAPITAL P on September 12, 2024 and sell it today you would lose (589.00) from holding BAT CAPITAL P or give up 6.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.31%
Values	Daily Returns

BAT CAPITAL P  vs.  Brenmiller Energy Ltd

BAT CAPITAL P

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BAT CAPITAL P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for BAT CAPITAL P investors.

Brenmiller Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brenmiller Energy Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with 05526DBS3 and Brenmiller Energy

The main advantage of trading using opposite 05526DBS3 and Brenmiller Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 05526DBS3 position performs unexpectedly, Brenmiller Energy 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 Brenmiller Energy will offset losses from the drop in Brenmiller Energy's long position.

The idea behind BAT CAPITAL P and Brenmiller Energy Ltd 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.