Correlation Between BROOKDALE and Boyd Gaming
Can any of the company-specific risk be diversified away by investing in both BROOKDALE and Boyd Gaming 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 BROOKDALE and Boyd Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BROOKDALE SR LIVING and Boyd Gaming, you can compare the effects of market volatilities on BROOKDALE and Boyd Gaming 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 BROOKDALE with a short position of Boyd Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of BROOKDALE and Boyd Gaming.
Diversification Opportunities for BROOKDALE and Boyd Gaming
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BROOKDALE and Boyd is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding BROOKDALE SR LIVING and Boyd Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyd Gaming and BROOKDALE 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 BROOKDALE SR LIVING are associated (or correlated) with Boyd Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boyd Gaming has no effect on the direction of BROOKDALE i.e., BROOKDALE and Boyd Gaming go up and down completely randomly.
Pair Corralation between BROOKDALE and Boyd Gaming
Assuming the 90 days trading horizon BROOKDALE SR LIVING is expected to generate 2.0 times more return on investment than Boyd Gaming. However, BROOKDALE is 2.0 times more volatile than Boyd Gaming. It trades about 0.06 of its potential returns per unit of risk. Boyd Gaming is currently generating about 0.04 per unit of risk. If you would invest 252.00 in BROOKDALE SR LIVING on December 4, 2024 and sell it today you would earn a total of 283.00 from holding BROOKDALE SR LIVING or generate 112.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
BROOKDALE SR LIVING vs. Boyd Gaming
Performance |
| Timeline |
| BROOKDALE SR LIVING |
| Boyd Gaming |
BROOKDALE and Boyd Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BROOKDALE and Boyd Gaming
The main advantage of trading using opposite BROOKDALE and Boyd Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BROOKDALE position performs unexpectedly, Boyd Gaming 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 Boyd Gaming will offset losses from the drop in Boyd Gaming's long position.| BROOKDALE vs. SPARTAN STORES | BROOKDALE vs. Ross Stores | BROOKDALE vs. BORR DRILLING NEW | BROOKDALE vs. National Retail Properties |
| Boyd Gaming vs. OFFICE DEPOT | Boyd Gaming vs. WILLIS LEASE FIN | Boyd Gaming vs. Canadian Utilities Limited | Boyd Gaming vs. 24SEVENOFFICE GROUP AB |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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