Correlation Between BASE and Intuit
Can any of the company-specific risk be diversified away by investing in both BASE and Intuit 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 BASE and Intuit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BASE Inc and Intuit Inc, you can compare the effects of market volatilities on BASE and Intuit 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 BASE with a short position of Intuit. Check out your portfolio center. Please also check ongoing floating volatility patterns of BASE and Intuit.
Diversification Opportunities for BASE and Intuit
Excellent diversification
The 3 months correlation between BASE and Intuit is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding BASE Inc and Intuit Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuit Inc and BASE 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 BASE Inc are associated (or correlated) with Intuit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intuit Inc has no effect on the direction of BASE i.e., BASE and Intuit go up and down completely randomly.
Pair Corralation between BASE and Intuit
Assuming the 90 days horizon BASE Inc is expected to generate 1.75 times more return on investment than Intuit. However, BASE is 1.75 times more volatile than Intuit Inc. It trades about 0.22 of its potential returns per unit of risk. Intuit Inc is currently generating about 0.0 per unit of risk. If you would invest 199.00 in BASE Inc on December 11, 2024 and sell it today you would earn a total of 55.00 from holding BASE Inc or generate 27.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BASE Inc vs. Intuit Inc
Performance |
| Timeline |
| BASE Inc |
| Intuit Inc |
BASE and Intuit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BASE and Intuit
The main advantage of trading using opposite BASE and Intuit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BASE position performs unexpectedly, Intuit 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 Intuit will offset losses from the drop in Intuit's long position.| BASE vs. CurrentC Power | BASE vs. Agent Information Software | BASE vs. Auddia Inc | BASE vs. Maxwell Resource |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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