Correlation Between BORR DRILLING and Focus Home
Can any of the company-specific risk be diversified away by investing in both BORR DRILLING and Focus Home 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 BORR DRILLING and Focus Home into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BORR DRILLING NEW and Focus Home Interactive, you can compare the effects of market volatilities on BORR DRILLING and Focus Home 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 BORR DRILLING with a short position of Focus Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of BORR DRILLING and Focus Home.
Diversification Opportunities for BORR DRILLING and Focus Home
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BORR and Focus is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding BORR DRILLING NEW and Focus Home Interactive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Focus Home Interactive and BORR DRILLING 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 BORR DRILLING NEW are associated (or correlated) with Focus Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Focus Home Interactive has no effect on the direction of BORR DRILLING i.e., BORR DRILLING and Focus Home go up and down completely randomly.
Pair Corralation between BORR DRILLING and Focus Home
Assuming the 90 days horizon BORR DRILLING NEW is expected to generate 0.95 times more return on investment than Focus Home. However, BORR DRILLING NEW is 1.05 times less risky than Focus Home. It trades about 0.13 of its potential returns per unit of risk. Focus Home Interactive is currently generating about 0.07 per unit of risk. If you would invest 355.00 in BORR DRILLING NEW on October 11, 2024 and sell it today you would earn a total of 33.00 from holding BORR DRILLING NEW or generate 9.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BORR DRILLING NEW vs. Focus Home Interactive
Performance |
| Timeline |
| BORR DRILLING NEW |
| Focus Home Interactive |
BORR DRILLING and Focus Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BORR DRILLING and Focus Home
The main advantage of trading using opposite BORR DRILLING and Focus Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BORR DRILLING position performs unexpectedly, Focus Home 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 Focus Home will offset losses from the drop in Focus Home's long position.| BORR DRILLING vs. CITY OFFICE REIT | BORR DRILLING vs. CENTURIA OFFICE REIT | BORR DRILLING vs. SPECTRAL MEDICAL | BORR DRILLING vs. OBSERVE MEDICAL ASA |
| Focus Home vs. AWILCO DRILLING PLC | Focus Home vs. BORR DRILLING NEW | Focus Home vs. Neinor Homes SA | Focus Home vs. American Homes 4 |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |