Correlation Between BigBearai Holdings and REPUBLIC

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Can any of the company-specific risk be diversified away by investing in both BigBearai Holdings and REPUBLIC 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 BigBearai Holdings and REPUBLIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BigBearai Holdings and REPUBLIC SVCS INC, you can compare the effects of market volatilities on BigBearai Holdings and REPUBLIC 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 BigBearai Holdings with a short position of REPUBLIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of BigBearai Holdings and REPUBLIC.

Diversification Opportunities for BigBearai Holdings and REPUBLIC

-0.73
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between BigBearai and REPUBLIC is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding BigBearai Holdings and REPUBLIC SVCS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REPUBLIC SVCS INC and BigBearai Holdings 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 BigBearai Holdings are associated (or correlated) with REPUBLIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REPUBLIC SVCS INC has no effect on the direction of BigBearai Holdings i.e., BigBearai Holdings and REPUBLIC go up and down completely randomly.

Pair Corralation between BigBearai Holdings and REPUBLIC

Given the investment horizon of 90 days BigBearai Holdings is expected to generate 12.6 times more return on investment than REPUBLIC. However, BigBearai Holdings is 12.6 times more volatile than REPUBLIC SVCS INC. It trades about 0.31 of its potential returns per unit of risk. REPUBLIC SVCS INC is currently generating about -0.2 per unit of risk. If you would invest  171.00  in BigBearai Holdings on September 14, 2024 and sell it today you would earn a total of  127.00  from holding BigBearai Holdings or generate 74.27% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy95.45%
ValuesDaily Returns

BigBearai Holdings  vs.  REPUBLIC SVCS INC

 Performance 
       Timeline  
BigBearai Holdings 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in BigBearai Holdings are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, BigBearai Holdings demonstrated solid returns over the last few months and may actually be approaching a breakup point.
REPUBLIC SVCS INC 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days REPUBLIC SVCS INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, REPUBLIC is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

BigBearai Holdings and REPUBLIC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with BigBearai Holdings and REPUBLIC

The main advantage of trading using opposite BigBearai Holdings and REPUBLIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BigBearai Holdings position performs unexpectedly, REPUBLIC 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 REPUBLIC will offset losses from the drop in REPUBLIC's long position.
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The idea behind BigBearai Holdings and REPUBLIC SVCS INC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

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