Correlation Between Boeing and Regents Park
Can any of the company-specific risk be diversified away by investing in both Boeing and Regents Park 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 Regents Park into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Boeing and Regents Park Hedged, you can compare the effects of market volatilities on Boeing and Regents Park 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 Regents Park. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boeing and Regents Park.
Diversification Opportunities for Boeing and Regents Park
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boeing and Regents is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing and Regents Park Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regents Park Hedged 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 Regents Park. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regents Park Hedged has no effect on the direction of Boeing i.e., Boeing and Regents Park go up and down completely randomly.
Pair Corralation between Boeing and Regents Park
Allowing for the 90-day total investment horizon The Boeing is expected to generate 3.96 times more return on investment than Regents Park. However, Boeing is 3.96 times more volatile than Regents Park Hedged. It trades about 0.1 of its potential returns per unit of risk. Regents Park Hedged is currently generating about 0.35 per unit of risk. If you would invest 14,931 in The Boeing on September 1, 2024 and sell it today you would earn a total of 613.00 from holding The Boeing or generate 4.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
The Boeing vs. Regents Park Hedged
Performance |
| Timeline |
| Boeing |
| Regents Park Hedged |
Boeing and Regents Park Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boeing and Regents Park
The main advantage of trading using opposite Boeing and Regents Park positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boeing position performs unexpectedly, Regents Park 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 Regents Park will offset losses from the drop in Regents Park's long position.| Boeing vs. Raytheon Technologies Corp | Boeing vs. Northrop Grumman | Boeing vs. General Dynamics | Boeing vs. L3Harris Technologies |
| Regents Park vs. iShares ESG Aware | Regents Park vs. iShares ESG Aware | Regents Park vs. iShares ESG Aware | Regents Park vs. iShares ESG Advanced |
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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