Correlation Between Booz Allen and Franklin Covey
Can any of the company-specific risk be diversified away by investing in both Booz Allen and Franklin Covey 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 Franklin Covey 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 Franklin Covey, you can compare the effects of market volatilities on Booz Allen and Franklin Covey 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 Franklin Covey. Check out your portfolio center. Please also check ongoing floating volatility patterns of Booz Allen and Franklin Covey.
Diversification Opportunities for Booz Allen and Franklin Covey
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Booz and Franklin is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Booz Allen Hamilton and Franklin Covey in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Covey 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 Franklin Covey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Covey has no effect on the direction of Booz Allen i.e., Booz Allen and Franklin Covey go up and down completely randomly.
Pair Corralation between Booz Allen and Franklin Covey
Considering the 90-day investment horizon Booz Allen Hamilton is expected to under-perform the Franklin Covey. But the stock apears to be less risky and, when comparing its historical volatility, Booz Allen Hamilton is 1.01 times less risky than Franklin Covey. The stock trades about -0.1 of its potential returns per unit of risk. The Franklin Covey is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 3,937 in Franklin Covey on August 25, 2024 and sell it today you would lose (311.00) from holding Franklin Covey or give up 7.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Booz Allen Hamilton vs. Franklin Covey
Performance |
| Timeline |
| Booz Allen Hamilton |
| Franklin Covey |
Booz Allen and Franklin Covey Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Booz Allen and Franklin Covey
The main advantage of trading using opposite Booz Allen and Franklin Covey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Booz Allen position performs unexpectedly, Franklin Covey 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 Franklin Covey will offset losses from the drop in Franklin Covey's long position.| Booz Allen vs. Huron Consulting Group | Booz Allen vs. CRA International | Booz Allen vs. Forrester Research | Booz Allen vs. Exponent |
| Franklin Covey vs. CRA International | Franklin Covey vs. Thermon Group Holdings | Franklin Covey vs. Forrester Research | Franklin Covey vs. Forestar Group |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Commodity Directory Find actively traded commodities issued by global exchanges |