Correlation Between For Earth and Babylon Holdings

Can any of the company-specific risk be diversified away by investing in both For Earth and Babylon Holdings 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 For Earth and Babylon Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between For The Earth and Babylon Holdings Limited, you can compare the effects of market volatilities on For Earth and Babylon Holdings 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 For Earth with a short position of Babylon Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of For Earth and Babylon Holdings.

Diversification Opportunities for For Earth and Babylon Holdings

0.0

Correlation Coefficient

For Earth  Babylon Holdings

Pay attention - limited upside

The 3 months correlation between For and Babylon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding For The Earth and Babylon Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Babylon Holdings and For Earth 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 For The Earth are associated (or correlated) with Babylon Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Babylon Holdings has no effect on the direction of For Earth i.e., For Earth and Babylon Holdings go up and down completely randomly.

Pair Corralation between For Earth and Babylon Holdings

If you would invest (100.00) in Babylon Holdings Limited on May 4, 2025 and sell it today you would earn a total of  100.00  from holding Babylon Holdings Limited or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

For The Earth  vs.  Babylon Holdings Limited

For The Earth

Risk-Adjusted Performance

Very Weak

Over the last 90 days For The Earth has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, For Earth is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Babylon Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Babylon Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Babylon Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with For Earth and Babylon Holdings

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

The idea behind For The Earth and Babylon Holdings Limited 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.