Correlation Between Biglari Holdings and VirnetX Holding
Can any of the company-specific risk be diversified away by investing in both Biglari Holdings and VirnetX Holding 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 Biglari Holdings and VirnetX Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biglari Holdings and VirnetX Holding Corp, you can compare the effects of market volatilities on Biglari Holdings and VirnetX Holding 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 Biglari Holdings with a short position of VirnetX Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biglari Holdings and VirnetX Holding.
Diversification Opportunities for Biglari Holdings and VirnetX Holding
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Biglari and VirnetX is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Biglari Holdings and VirnetX Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VirnetX Holding Corp and Biglari 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 Biglari Holdings are associated (or correlated) with VirnetX Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VirnetX Holding Corp has no effect on the direction of Biglari Holdings i.e., Biglari Holdings and VirnetX Holding go up and down completely randomly.
Pair Corralation between Biglari Holdings and VirnetX Holding
Allowing for the 90-day total investment horizon Biglari Holdings is expected to generate 0.53 times more return on investment than VirnetX Holding. However, Biglari Holdings is 1.9 times less risky than VirnetX Holding. It trades about 0.05 of its potential returns per unit of risk. VirnetX Holding Corp is currently generating about 0.01 per unit of risk. If you would invest 17,776 in Biglari Holdings on September 1, 2024 and sell it today you would earn a total of 3,267 from holding Biglari Holdings or generate 18.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biglari Holdings vs. VirnetX Holding Corp
Performance |
| Timeline |
| Biglari Holdings |
| VirnetX Holding Corp |
Biglari Holdings and VirnetX Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biglari Holdings and VirnetX Holding
The main advantage of trading using opposite Biglari Holdings and VirnetX Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biglari Holdings position performs unexpectedly, VirnetX Holding 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 VirnetX Holding will offset losses from the drop in VirnetX Holding's long position.| Biglari Holdings vs. Cannae Holdings | Biglari Holdings vs. BJs Restaurants | Biglari Holdings vs. Ark Restaurants Corp | Biglari Holdings vs. Noble Romans |
| VirnetX Holding vs. Palo Alto Networks | VirnetX Holding vs. GigaCloud Technology Class | VirnetX Holding vs. Pagaya Technologies | VirnetX Holding vs. Telos Corp |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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