Correlation Between Direct Capital and Batm Advanced

Can any of the company-specific risk be diversified away by investing in both Direct Capital and Batm Advanced 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 Direct Capital and Batm Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Direct Capital Investments and Batm Advanced Communications, you can compare the effects of market volatilities on Direct Capital and Batm Advanced 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 Direct Capital with a short position of Batm Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direct Capital and Batm Advanced.

Diversification Opportunities for Direct Capital and Batm Advanced

-0.77

Correlation Coefficient

Direct Capital  Batm Advanced

Pay attention - limited upside

The 3 months correlation between Direct and Batm is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Direct Capital Investments and Batm Advanced Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Batm Advanced Commun and Direct Capital 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 Direct Capital Investments are associated (or correlated) with Batm Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Batm Advanced Commun has no effect on the direction of Direct Capital i.e., Direct Capital and Batm Advanced go up and down completely randomly.

Pair Corralation between Direct Capital and Batm Advanced

Assuming the 90 days trading horizon Direct Capital is expected to generate 1.21 times less return on investment than Batm Advanced. In addition to that, Direct Capital is 3.25 times more volatile than Batm Advanced Communications. It trades about 0.05 of its total potential returns per unit of risk. Batm Advanced Communications is currently generating about 0.2 per unit of volatility. If you would invest  6,710  in Batm Advanced Communications on June 11, 2025 and sell it today you would earn a total of  290.00  from holding Batm Advanced Communications or generate 4.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	94.12%
Values	Daily Returns

Direct Capital Investments  vs.  Batm Advanced Communications

Direct Capital Inves

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Direct Capital Investments are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak forward indicators, Direct Capital sustained solid returns over the last few months and may actually be approaching a breakup point.

Batm Advanced Commun

Risk-Adjusted Performance

Weakest

Over the last 90 days Batm Advanced Communications has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental indicators remain somewhat strong which may send shares a bit higher in October 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Direct Capital and Batm Advanced

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

The idea behind Direct Capital Investments and Batm Advanced Communications 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.