Correlation Between United Tractors and Bel Fuse
Can any of the company-specific risk be diversified away by investing in both United Tractors and Bel Fuse 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 United Tractors and Bel Fuse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Tractors Tbk and Bel Fuse A, you can compare the effects of market volatilities on United Tractors and Bel Fuse 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 United Tractors with a short position of Bel Fuse. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Tractors and Bel Fuse.
Diversification Opportunities for United Tractors and Bel Fuse
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between United and Bel is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding United Tractors Tbk and Bel Fuse A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bel Fuse A and United Tractors 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 United Tractors Tbk are associated (or correlated) with Bel Fuse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bel Fuse A has no effect on the direction of United Tractors i.e., United Tractors and Bel Fuse go up and down completely randomly.
Pair Corralation between United Tractors and Bel Fuse
Assuming the 90 days horizon United Tractors is expected to generate 1.31 times less return on investment than Bel Fuse. But when comparing it to its historical volatility, United Tractors Tbk is 1.24 times less risky than Bel Fuse. It trades about 0.11 of its potential returns per unit of risk. Bel Fuse A is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 11,650 in Bel Fuse A on September 6, 2025 and sell it today you would earn a total of 2,574 from holding Bel Fuse A or generate 22.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Tractors Tbk vs. Bel Fuse A
Performance |
| Timeline |
| United Tractors Tbk |
| Bel Fuse A |
United Tractors and Bel Fuse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Tractors and Bel Fuse
The main advantage of trading using opposite United Tractors and Bel Fuse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Tractors position performs unexpectedly, Bel Fuse 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 Bel Fuse will offset losses from the drop in Bel Fuse's long position.| United Tractors vs. Xtreme Motorsports International | United Tractors vs. Canlan Ice Sports | United Tractors vs. Centaurus Metals Limited | United Tractors vs. Alliance Sports Group |
| Bel Fuse vs. Lombard Medical | Bel Fuse vs. ProUroCare Medical | Bel Fuse vs. Todos Medical | Bel Fuse vs. MagnaChip Semiconductor |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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