Correlation Between Bristol-Myers Squibb and Helio
Can any of the company-specific risk be diversified away by investing in both Bristol-Myers Squibb and Helio 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 Bristol-Myers Squibb and Helio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bristol Myers Squibb and Helio, you can compare the effects of market volatilities on Bristol-Myers Squibb and Helio 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 Bristol-Myers Squibb with a short position of Helio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bristol-Myers Squibb and Helio.
Diversification Opportunities for Bristol-Myers Squibb and Helio
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bristol-Myers and Helio is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Bristol Myers Squibb and Helio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helio and Bristol-Myers Squibb 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 Bristol Myers Squibb are associated (or correlated) with Helio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helio has no effect on the direction of Bristol-Myers Squibb i.e., Bristol-Myers Squibb and Helio go up and down completely randomly.
Pair Corralation between Bristol-Myers Squibb and Helio
Assuming the 90 days horizon Bristol Myers Squibb is expected to under-perform the Helio. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bristol Myers Squibb is 10.34 times less risky than Helio. The pink sheet trades about -0.15 of its potential returns per unit of risk. The Helio is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 492.00 in Helio on November 3, 2024 and sell it today you would earn a total of 208.00 from holding Helio or generate 42.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bristol Myers Squibb vs. Helio
Performance |
| Timeline |
| Bristol Myers Squibb |
| Helio |
Bristol-Myers Squibb and Helio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bristol-Myers Squibb and Helio
The main advantage of trading using opposite Bristol-Myers Squibb and Helio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bristol-Myers Squibb position performs unexpectedly, Helio 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 Helio will offset losses from the drop in Helio's long position.| Bristol-Myers Squibb vs. Novartis AG | Bristol-Myers Squibb vs. Bayer AG | Bristol-Myers Squibb vs. Astellas Pharma | Bristol-Myers Squibb vs. Roche Holding AG |
| Helio vs. East Africa Metals | Helio vs. Eldorado Gold Corp | Helio vs. Copperbank Resources Corp | Helio vs. PepsiCo |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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