Correlation Between Service International and Bitmis Corp

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

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

Diversification Opportunities for Service International and Bitmis Corp

0.45

Correlation Coefficient

Service International  Bitmis Corp

Very weak diversification

The 3 months correlation between Service and Bitmis is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Service International and Bitmis Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitmis Corp and Service International 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 Service International are associated (or correlated) with Bitmis Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitmis Corp has no effect on the direction of Service International i.e., Service International and Bitmis Corp go up and down completely randomly.

Pair Corralation between Service International and Bitmis Corp

Considering the 90-day investment horizon Service International is expected to under-perform the Bitmis Corp. In addition to that, Service International is 5.56 times more volatile than Bitmis Corp. It trades about -0.01 of its total potential returns per unit of risk. Bitmis Corp is currently generating about 0.15 per unit of volatility. If you would invest  401.00  in Bitmis Corp on January 29, 2024 and sell it today you would earn a total of  5.00  from holding Bitmis Corp or generate 1.25% return on investment over 90 days.

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

Service International  vs.  Bitmis Corp

Service International

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Service International are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, Service International is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Bitmis Corp

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bitmis Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile primary indicators, Bitmis Corp may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Pair Trading with Service International and Bitmis Corp

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

The idea behind Service International and Bitmis Corp 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.