Correlation Between Blackbaud and Expensify
Can any of the company-specific risk be diversified away by investing in both Blackbaud and Expensify 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 Blackbaud and Expensify into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackbaud and Expensify, you can compare the effects of market volatilities on Blackbaud and Expensify 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 Blackbaud with a short position of Expensify. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackbaud and Expensify.
Diversification Opportunities for Blackbaud and Expensify
Average diversification
The 3 months correlation between Blackbaud and Expensify is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Blackbaud and Expensify in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expensify and Blackbaud 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 Blackbaud are associated (or correlated) with Expensify. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expensify has no effect on the direction of Blackbaud i.e., Blackbaud and Expensify go up and down completely randomly.
Pair Corralation between Blackbaud and Expensify
Given the investment horizon of 90 days Blackbaud is expected to generate 7.31 times less return on investment than Expensify. But when comparing it to its historical volatility, Blackbaud is 3.43 times less risky than Expensify. It trades about 0.06 of its potential returns per unit of risk. Expensify is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 154.00 in Expensify on August 28, 2024 and sell it today you would earn a total of 180.00 from holding Expensify or generate 116.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackbaud vs. Expensify
Performance |
| Timeline |
| Blackbaud |
| Expensify |
Blackbaud and Expensify Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackbaud and Expensify
The main advantage of trading using opposite Blackbaud and Expensify positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackbaud position performs unexpectedly, Expensify 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 Expensify will offset losses from the drop in Expensify's long position.The idea behind Blackbaud and Expensify 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.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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |