Correlation Between Berner Kantonalbank and Aeorema Communications
Can any of the company-specific risk be diversified away by investing in both Berner Kantonalbank and Aeorema Communications 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 Berner Kantonalbank and Aeorema Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berner Kantonalbank AG and Aeorema Communications Plc, you can compare the effects of market volatilities on Berner Kantonalbank and Aeorema Communications 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 Berner Kantonalbank with a short position of Aeorema Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berner Kantonalbank and Aeorema Communications.
Diversification Opportunities for Berner Kantonalbank and Aeorema Communications
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Berner and Aeorema is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Berner Kantonalbank AG and Aeorema Communications Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeorema Communications and Berner Kantonalbank 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 Berner Kantonalbank AG are associated (or correlated) with Aeorema Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeorema Communications has no effect on the direction of Berner Kantonalbank i.e., Berner Kantonalbank and Aeorema Communications go up and down completely randomly.
Pair Corralation between Berner Kantonalbank and Aeorema Communications
Assuming the 90 days trading horizon Berner Kantonalbank AG is expected to generate 0.36 times more return on investment than Aeorema Communications. However, Berner Kantonalbank AG is 2.81 times less risky than Aeorema Communications. It trades about 0.12 of its potential returns per unit of risk. Aeorema Communications Plc is currently generating about 0.04 per unit of risk. If you would invest 23,300 in Berner Kantonalbank AG on September 11, 2025 and sell it today you would earn a total of 5,050 from holding Berner Kantonalbank AG or generate 21.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.81% |
| Values | Daily Returns |
Berner Kantonalbank AG vs. Aeorema Communications Plc
Performance |
| Timeline |
| Berner Kantonalbank |
| Aeorema Communications |
Berner Kantonalbank and Aeorema Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berner Kantonalbank and Aeorema Communications
The main advantage of trading using opposite Berner Kantonalbank and Aeorema Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berner Kantonalbank position performs unexpectedly, Aeorema Communications 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 Aeorema Communications will offset losses from the drop in Aeorema Communications' long position.| Berner Kantonalbank vs. Roadside Real Estate | Berner Kantonalbank vs. Power Metal Resources | Berner Kantonalbank vs. Tamburi Investment Partners | Berner Kantonalbank vs. Synergia Energy |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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