Correlation Between Bigbloc Construction and Industrial Investment

Can any of the company-specific risk be diversified away by investing in both Bigbloc Construction and Industrial Investment 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 Bigbloc Construction and Industrial Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bigbloc Construction Limited and Industrial Investment Trust, you can compare the effects of market volatilities on Bigbloc Construction and Industrial Investment 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 Bigbloc Construction with a short position of Industrial Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bigbloc Construction and Industrial Investment.

Diversification Opportunities for Bigbloc Construction and Industrial Investment

0.66

Correlation Coefficient

Bigbloc Construction  Industrial Investment

Poor diversification

The 3 months correlation between Bigbloc and Industrial is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Bigbloc Construction Limited and Industrial Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Investment and Bigbloc Construction 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 Bigbloc Construction Limited are associated (or correlated) with Industrial Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Investment has no effect on the direction of Bigbloc Construction i.e., Bigbloc Construction and Industrial Investment go up and down completely randomly.

Pair Corralation between Bigbloc Construction and Industrial Investment

Assuming the 90 days trading horizon Bigbloc Construction Limited is expected to under-perform the Industrial Investment. In addition to that, Bigbloc Construction is 1.13 times more volatile than Industrial Investment Trust. It trades about -0.08 of its total potential returns per unit of risk. Industrial Investment Trust is currently generating about -0.05 per unit of volatility. If you would invest  17,591  in Industrial Investment Trust on May 7, 2025 and sell it today you would lose (1,305) from holding Industrial Investment Trust or give up 7.42% of portfolio value over 90 days.

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

Bigbloc Construction Limited  vs.  Industrial Investment Trust

Bigbloc Construction

Risk-Adjusted Performance

Weakest

Over the last 90 days Bigbloc Construction Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's essential indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Industrial Investment

Risk-Adjusted Performance

Weakest

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

Pair Trading with Bigbloc Construction and Industrial Investment

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

The idea behind Bigbloc Construction Limited and Industrial Investment Trust 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.