Correlation Between Bigcommerce Holdings and American Well
Can any of the company-specific risk be diversified away by investing in both Bigcommerce Holdings and American Well 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 Bigcommerce Holdings and American Well into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bigcommerce Holdings and American Well Corp, you can compare the effects of market volatilities on Bigcommerce Holdings and American Well 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 Bigcommerce Holdings with a short position of American Well. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bigcommerce Holdings and American Well.
Diversification Opportunities for Bigcommerce Holdings and American Well
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bigcommerce and American is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Bigcommerce Holdings and American Well Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Well Corp and Bigcommerce 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 Bigcommerce Holdings are associated (or correlated) with American Well. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Well Corp has no effect on the direction of Bigcommerce Holdings i.e., Bigcommerce Holdings and American Well go up and down completely randomly.
Pair Corralation between Bigcommerce Holdings and American Well
Given the investment horizon of 90 days Bigcommerce Holdings is expected to generate 0.89 times more return on investment than American Well. However, Bigcommerce Holdings is 1.12 times less risky than American Well. It trades about 0.08 of its potential returns per unit of risk. American Well Corp is currently generating about -0.04 per unit of risk. If you would invest 663.00 in Bigcommerce Holdings on November 29, 2024 and sell it today you would earn a total of 35.00 from holding Bigcommerce Holdings or generate 5.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bigcommerce Holdings vs. American Well Corp
Performance |
| Timeline |
| Bigcommerce Holdings |
| American Well Corp |
Bigcommerce Holdings and American Well Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bigcommerce Holdings and American Well
The main advantage of trading using opposite Bigcommerce Holdings and American Well positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bigcommerce Holdings position performs unexpectedly, American Well 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 American Well will offset losses from the drop in American Well's long position.| Bigcommerce Holdings vs. nCino Inc | Bigcommerce Holdings vs. ZoomInfo Technologies | Bigcommerce Holdings vs. Gitlab Inc | Bigcommerce Holdings vs. MondayCom |
| American Well vs. Doximity | American Well vs. Certara | American Well vs. Teladoc | American Well vs. Definitive Healthcare 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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