Correlation Between BYD ELECTRONIC and NO GRAVITY

Can any of the company-specific risk be diversified away by investing in both BYD ELECTRONIC and NO GRAVITY 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 BYD ELECTRONIC and NO GRAVITY into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BYD ELECTRONIC and NO GRAVITY GAMES, you can compare the effects of market volatilities on BYD ELECTRONIC and NO GRAVITY 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 BYD ELECTRONIC with a short position of NO GRAVITY. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD ELECTRONIC and NO GRAVITY.

Diversification Opportunities for BYD ELECTRONIC and NO GRAVITY

0.25

Correlation Coefficient

BYD ELECTRONIC  NO GRAVITY

Modest diversification

The 3 months correlation between BYD and 8YX is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding BYD ELECTRONIC and NO GRAVITY GAMES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NO GRAVITY GAMES and BYD ELECTRONIC 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 BYD ELECTRONIC are associated (or correlated) with NO GRAVITY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NO GRAVITY GAMES has no effect on the direction of BYD ELECTRONIC i.e., BYD ELECTRONIC and NO GRAVITY go up and down completely randomly.

Pair Corralation between BYD ELECTRONIC and NO GRAVITY

Assuming the 90 days trading horizon BYD ELECTRONIC is expected to generate 0.71 times more return on investment than NO GRAVITY. However, BYD ELECTRONIC is 1.41 times less risky than NO GRAVITY. It trades about 0.05 of its potential returns per unit of risk. NO GRAVITY GAMES is currently generating about 0.0 per unit of risk. If you would invest  179.00  in BYD ELECTRONIC on February 7, 2024 and sell it today you would earn a total of  147.00  from holding BYD ELECTRONIC or generate 82.12% return on investment over 90 days.

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

BYD ELECTRONIC  vs.  NO GRAVITY GAMES

BYD ELECTRONIC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BYD ELECTRONIC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, BYD ELECTRONIC is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

NO GRAVITY GAMES

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in NO GRAVITY GAMES are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, NO GRAVITY reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BYD ELECTRONIC and NO GRAVITY

The main advantage of trading using opposite BYD ELECTRONIC and NO GRAVITY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD ELECTRONIC position performs unexpectedly, NO GRAVITY 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 NO GRAVITY will offset losses from the drop in NO GRAVITY's long position.

The idea behind BYD ELECTRONIC and NO GRAVITY GAMES 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.