Correlation Between Addus HomeCare and Boyaa Interactive
Can any of the company-specific risk be diversified away by investing in both Addus HomeCare and Boyaa Interactive 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 Addus HomeCare and Boyaa Interactive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addus HomeCare and Boyaa Interactive International, you can compare the effects of market volatilities on Addus HomeCare and Boyaa Interactive 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 Addus HomeCare with a short position of Boyaa Interactive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addus HomeCare and Boyaa Interactive.
Diversification Opportunities for Addus HomeCare and Boyaa Interactive
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Addus and Boyaa is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Addus HomeCare and Boyaa Interactive Internationa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyaa Interactive and Addus HomeCare 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 Addus HomeCare are associated (or correlated) with Boyaa Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boyaa Interactive has no effect on the direction of Addus HomeCare i.e., Addus HomeCare and Boyaa Interactive go up and down completely randomly.
Pair Corralation between Addus HomeCare and Boyaa Interactive
Assuming the 90 days horizon Addus HomeCare is expected to generate 8.57 times less return on investment than Boyaa Interactive. But when comparing it to its historical volatility, Addus HomeCare is 3.72 times less risky than Boyaa Interactive. It trades about 0.06 of its potential returns per unit of risk. Boyaa Interactive International is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 5.34 in Boyaa Interactive International on September 12, 2024 and sell it today you would earn a total of 62.66 from holding Boyaa Interactive International or generate 1173.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Addus HomeCare vs. Boyaa Interactive Internationa
Performance |
| Timeline |
| Addus HomeCare |
| Boyaa Interactive |
Addus HomeCare and Boyaa Interactive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addus HomeCare and Boyaa Interactive
The main advantage of trading using opposite Addus HomeCare and Boyaa Interactive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addus HomeCare position performs unexpectedly, Boyaa Interactive 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 Boyaa Interactive will offset losses from the drop in Boyaa Interactive's long position.| Addus HomeCare vs. Ramsay Health Care | Addus HomeCare vs. Universal Health Services | Addus HomeCare vs. Superior Plus Corp | Addus HomeCare vs. SIVERS SEMICONDUCTORS AB |
| Boyaa Interactive vs. Compagnie Plastic Omnium | Boyaa Interactive vs. HomeToGo SE | Boyaa Interactive vs. Tri Pointe Homes | Boyaa Interactive vs. Addus HomeCare |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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