Correlation Between Boise Cascade and Corticeira Amorim
Can any of the company-specific risk be diversified away by investing in both Boise Cascade and Corticeira Amorim 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 Boise Cascade and Corticeira Amorim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boise Cascade and Corticeira Amorim SGPS, you can compare the effects of market volatilities on Boise Cascade and Corticeira Amorim 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 Boise Cascade with a short position of Corticeira Amorim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boise Cascade and Corticeira Amorim.
Diversification Opportunities for Boise Cascade and Corticeira Amorim
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boise and Corticeira is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Boise Cascade and Corticeira Amorim SGPS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corticeira Amorim SGPS and Boise Cascade 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 Boise Cascade are associated (or correlated) with Corticeira Amorim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corticeira Amorim SGPS has no effect on the direction of Boise Cascade i.e., Boise Cascade and Corticeira Amorim go up and down completely randomly.
Pair Corralation between Boise Cascade and Corticeira Amorim
Assuming the 90 days horizon Boise Cascade is expected to generate 2.41 times more return on investment than Corticeira Amorim. However, Boise Cascade is 2.41 times more volatile than Corticeira Amorim SGPS. It trades about 0.08 of its potential returns per unit of risk. Corticeira Amorim SGPS is currently generating about 0.01 per unit of risk. If you would invest 6,442 in Boise Cascade on August 30, 2024 and sell it today you would earn a total of 7,598 from holding Boise Cascade or generate 117.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boise Cascade vs. Corticeira Amorim SGPS
Performance |
| Timeline |
| Boise Cascade |
| Corticeira Amorim SGPS |
Boise Cascade and Corticeira Amorim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boise Cascade and Corticeira Amorim
The main advantage of trading using opposite Boise Cascade and Corticeira Amorim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boise Cascade position performs unexpectedly, Corticeira Amorim 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 Corticeira Amorim will offset losses from the drop in Corticeira Amorim's long position.| Boise Cascade vs. LION ONE METALS | Boise Cascade vs. SOLSTAD OFFSHORE NK | Boise Cascade vs. GREENX METALS LTD | Boise Cascade vs. Kaiser Aluminum |
| Corticeira Amorim vs. Svenska Cellulosa Aktiebolaget | Corticeira Amorim vs. Superior Plus Corp | Corticeira Amorim vs. NMI Holdings | Corticeira Amorim vs. SIVERS SEMICONDUCTORS AB |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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