Correlation Between Bristol-Myers Squibb and Mars Bancorp
Can any of the company-specific risk be diversified away by investing in both Bristol-Myers Squibb and Mars Bancorp 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 Mars Bancorp 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 Mars Bancorp, you can compare the effects of market volatilities on Bristol-Myers Squibb and Mars Bancorp 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 Mars Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bristol-Myers Squibb and Mars Bancorp.
Diversification Opportunities for Bristol-Myers Squibb and Mars Bancorp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bristol-Myers and Mars is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bristol Myers Squibb and Mars Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mars Bancorp 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 Mars Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mars Bancorp has no effect on the direction of Bristol-Myers Squibb i.e., Bristol-Myers Squibb and Mars Bancorp go up and down completely randomly.
Pair Corralation between Bristol-Myers Squibb and Mars Bancorp
Assuming the 90 days horizon Bristol Myers Squibb is expected to under-perform the Mars Bancorp. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bristol Myers Squibb is 1.09 times less risky than Mars Bancorp. The pink sheet trades about 0.0 of its potential returns per unit of risk. The Mars Bancorp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,369 in Mars Bancorp on November 2, 2024 and sell it today you would lose (84.00) from holding Mars Bancorp or give up 6.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 42.37% |
| Values | Daily Returns |
Bristol Myers Squibb vs. Mars Bancorp
Performance |
| Timeline |
| Bristol Myers Squibb |
| Mars Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Bristol-Myers Squibb and Mars Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bristol-Myers Squibb and Mars Bancorp
The main advantage of trading using opposite Bristol-Myers Squibb and Mars Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bristol-Myers Squibb position performs unexpectedly, Mars Bancorp 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 Mars Bancorp will offset losses from the drop in Mars Bancorp'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 |
| Mars Bancorp vs. Potomac Bancshares | Mars Bancorp vs. Apollo Bancorp | Mars Bancorp vs. The Farmers Bank | Mars Bancorp vs. Community Bankers |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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