Correlation Between Burlington Stores, and Automatic Data
Can any of the company-specific risk be diversified away by investing in both Burlington Stores, and Automatic Data 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 Burlington Stores, and Automatic Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burlington Stores, and Automatic Data Processing, you can compare the effects of market volatilities on Burlington Stores, and Automatic Data 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 Burlington Stores, with a short position of Automatic Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burlington Stores, and Automatic Data.
Diversification Opportunities for Burlington Stores, and Automatic Data
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Burlington and Automatic is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Burlington Stores, and Automatic Data Processing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automatic Data Processing and Burlington Stores, 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 Burlington Stores, are associated (or correlated) with Automatic Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automatic Data Processing has no effect on the direction of Burlington Stores, i.e., Burlington Stores, and Automatic Data go up and down completely randomly.
Pair Corralation between Burlington Stores, and Automatic Data
Assuming the 90 days trading horizon Burlington Stores, is expected to generate 0.94 times more return on investment than Automatic Data. However, Burlington Stores, is 1.07 times less risky than Automatic Data. It trades about -0.05 of its potential returns per unit of risk. Automatic Data Processing is currently generating about -0.13 per unit of risk. If you would invest 5,976 in Burlington Stores, on October 12, 2024 and sell it today you would lose (50.00) from holding Burlington Stores, or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Burlington Stores, vs. Automatic Data Processing
Performance |
| Timeline |
| Burlington Stores, |
| Automatic Data Processing |
Burlington Stores, and Automatic Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burlington Stores, and Automatic Data
The main advantage of trading using opposite Burlington Stores, and Automatic Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burlington Stores, position performs unexpectedly, Automatic Data 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 Automatic Data will offset losses from the drop in Automatic Data's long position.| Burlington Stores, vs. CVS Health | Burlington Stores, vs. Tres Tentos Agroindustrial | Burlington Stores, vs. STAG Industrial, | Burlington Stores, vs. HDFC Bank Limited |
| Automatic Data vs. salesforce inc | Automatic Data vs. The Trade Desk | Automatic Data vs. Globus Medical, | Automatic Data vs. Costco Wholesale |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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