Correlation Between Bristol-Myers Squibb and Pan Global
Can any of the company-specific risk be diversified away by investing in both Bristol-Myers Squibb and Pan Global 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 Pan Global 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 Pan Global Resources, you can compare the effects of market volatilities on Bristol-Myers Squibb and Pan Global 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 Pan Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bristol-Myers Squibb and Pan Global.
Diversification Opportunities for Bristol-Myers Squibb and Pan Global
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bristol-Myers and Pan is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Bristol Myers Squibb and Pan Global Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pan Global Resources 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 Pan Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pan Global Resources has no effect on the direction of Bristol-Myers Squibb i.e., Bristol-Myers Squibb and Pan Global go up and down completely randomly.
Pair Corralation between Bristol-Myers Squibb and Pan Global
Assuming the 90 days horizon Bristol Myers Squibb is expected to generate 0.66 times more return on investment than Pan Global. However, Bristol Myers Squibb is 1.51 times less risky than Pan Global. It trades about 0.05 of its potential returns per unit of risk. Pan Global Resources is currently generating about -0.03 per unit of risk. If you would invest 82,569 in Bristol Myers Squibb on August 29, 2024 and sell it today you would earn a total of 17,986 from holding Bristol Myers Squibb or generate 21.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 81.73% |
| Values | Daily Returns |
Bristol Myers Squibb vs. Pan Global Resources
Performance |
| Timeline |
| Bristol Myers Squibb |
| Pan Global Resources |
Bristol-Myers Squibb and Pan Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bristol-Myers Squibb and Pan Global
The main advantage of trading using opposite Bristol-Myers Squibb and Pan Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bristol-Myers Squibb position performs unexpectedly, Pan Global 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 Pan Global will offset losses from the drop in Pan Global'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 |
| Pan Global vs. Wicket Gaming AB | Pan Global vs. Doubledown Interactive Co | Pan Global vs. Freedom Holding Corp | Pan Global vs. GameStop 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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