Correlation Between Boston Scientific and Freeport McMoRan
Can any of the company-specific risk be diversified away by investing in both Boston Scientific and Freeport McMoRan 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 Boston Scientific and Freeport McMoRan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Scientific Corp and Freeport McMoRan, you can compare the effects of market volatilities on Boston Scientific and Freeport McMoRan 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 Boston Scientific with a short position of Freeport McMoRan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Scientific and Freeport McMoRan.
Diversification Opportunities for Boston Scientific and Freeport McMoRan
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Boston and Freeport is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Boston Scientific Corp and Freeport McMoRan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freeport McMoRan and Boston Scientific 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 Boston Scientific Corp are associated (or correlated) with Freeport McMoRan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freeport McMoRan has no effect on the direction of Boston Scientific i.e., Boston Scientific and Freeport McMoRan go up and down completely randomly.
Pair Corralation between Boston Scientific and Freeport McMoRan
If you would invest 4,402 in Freeport McMoRan on October 12, 2024 and sell it today you would lose (440.00) from holding Freeport McMoRan or give up 10.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.2% |
| Values | Daily Returns |
Boston Scientific Corp vs. Freeport McMoRan
Performance |
| Timeline |
| Boston Scientific Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Freeport McMoRan |
Boston Scientific and Freeport McMoRan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Scientific and Freeport McMoRan
The main advantage of trading using opposite Boston Scientific and Freeport McMoRan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Scientific position performs unexpectedly, Freeport McMoRan 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 Freeport McMoRan will offset losses from the drop in Freeport McMoRan's long position.| Boston Scientific vs. Wheaton Precious Metals | Boston Scientific vs. Zegona Communications Plc | Boston Scientific vs. Lundin Mining Corp | Boston Scientific vs. Metals Exploration Plc |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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