Correlation Between Booz Allen and Bureau Veritas
Can any of the company-specific risk be diversified away by investing in both Booz Allen and Bureau Veritas 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 Booz Allen and Bureau Veritas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Booz Allen Hamilton and Bureau Veritas SA, you can compare the effects of market volatilities on Booz Allen and Bureau Veritas 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 Booz Allen with a short position of Bureau Veritas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Booz Allen and Bureau Veritas.
Diversification Opportunities for Booz Allen and Bureau Veritas
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Booz and Bureau is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Booz Allen Hamilton and Bureau Veritas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bureau Veritas SA and Booz Allen 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 Booz Allen Hamilton are associated (or correlated) with Bureau Veritas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bureau Veritas SA has no effect on the direction of Booz Allen i.e., Booz Allen and Bureau Veritas go up and down completely randomly.
Pair Corralation between Booz Allen and Bureau Veritas
Considering the 90-day investment horizon Booz Allen is expected to generate 12.33 times less return on investment than Bureau Veritas. In addition to that, Booz Allen is 2.06 times more volatile than Bureau Veritas SA. It trades about 0.0 of its total potential returns per unit of risk. Bureau Veritas SA is currently generating about 0.07 per unit of volatility. If you would invest 2,936 in Bureau Veritas SA on August 24, 2024 and sell it today you would earn a total of 279.00 from holding Bureau Veritas SA or generate 9.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Booz Allen Hamilton vs. Bureau Veritas SA
Performance |
| Timeline |
| Booz Allen Hamilton |
| Bureau Veritas SA |
Booz Allen and Bureau Veritas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Booz Allen and Bureau Veritas
The main advantage of trading using opposite Booz Allen and Bureau Veritas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Booz Allen position performs unexpectedly, Bureau Veritas 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 Bureau Veritas will offset losses from the drop in Bureau Veritas' long position.| Booz Allen vs. Huron Consulting Group | Booz Allen vs. CRA International | Booz Allen vs. Forrester Research | Booz Allen vs. Exponent |
| Bureau Veritas vs. Experian plc PK | Bureau Veritas vs. Equifax | Bureau Veritas vs. TransUnion | Bureau Veritas vs. Booz Allen Hamilton |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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