Correlation Between Boeing and Pinetree Capital
Can any of the company-specific risk be diversified away by investing in both Boeing and Pinetree Capital 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 Boeing and Pinetree Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Boeing and Pinetree Capital, you can compare the effects of market volatilities on Boeing and Pinetree Capital 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 Boeing with a short position of Pinetree Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boeing and Pinetree Capital.
Diversification Opportunities for Boeing and Pinetree Capital
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Boeing and Pinetree is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing and Pinetree Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinetree Capital and Boeing 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 The Boeing are associated (or correlated) with Pinetree Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinetree Capital has no effect on the direction of Boeing i.e., Boeing and Pinetree Capital go up and down completely randomly.
Pair Corralation between Boeing and Pinetree Capital
Allowing for the 90-day total investment horizon The Boeing is expected to under-perform the Pinetree Capital. But the stock apears to be less risky and, when comparing its historical volatility, The Boeing is 1.43 times less risky than Pinetree Capital. The stock trades about -0.03 of its potential returns per unit of risk. The Pinetree Capital is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 291.00 in Pinetree Capital on August 31, 2024 and sell it today you would earn a total of 596.00 from holding Pinetree Capital or generate 204.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 93.32% |
| Values | Daily Returns |
The Boeing vs. Pinetree Capital
Performance |
| Timeline |
| Boeing |
| Pinetree Capital |
Boeing and Pinetree Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boeing and Pinetree Capital
The main advantage of trading using opposite Boeing and Pinetree Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boeing position performs unexpectedly, Pinetree Capital 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 Pinetree Capital will offset losses from the drop in Pinetree Capital's long position.| Boeing vs. Raytheon Technologies Corp | Boeing vs. Northrop Grumman | Boeing vs. General Dynamics | Boeing vs. L3Harris Technologies |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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