Correlation Between Boyd Gaming and Titan Machinery
Can any of the company-specific risk be diversified away by investing in both Boyd Gaming and Titan Machinery 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 Boyd Gaming and Titan Machinery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boyd Gaming and Titan Machinery, you can compare the effects of market volatilities on Boyd Gaming and Titan Machinery 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 Boyd Gaming with a short position of Titan Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and Titan Machinery.
Diversification Opportunities for Boyd Gaming and Titan Machinery
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Boyd and Titan is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and Titan Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Titan Machinery and Boyd Gaming 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 Boyd Gaming are associated (or correlated) with Titan Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Titan Machinery has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and Titan Machinery go up and down completely randomly.
Pair Corralation between Boyd Gaming and Titan Machinery
Assuming the 90 days trading horizon Boyd Gaming is expected to generate 0.54 times more return on investment than Titan Machinery. However, Boyd Gaming is 1.86 times less risky than Titan Machinery. It trades about 0.03 of its potential returns per unit of risk. Titan Machinery is currently generating about -0.05 per unit of risk. If you would invest 5,468 in Boyd Gaming on August 26, 2024 and sell it today you would earn a total of 1,332 from holding Boyd Gaming or generate 24.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boyd Gaming vs. Titan Machinery
Performance |
| Timeline |
| Boyd Gaming |
| Titan Machinery |
Boyd Gaming and Titan Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boyd Gaming and Titan Machinery
The main advantage of trading using opposite Boyd Gaming and Titan Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boyd Gaming position performs unexpectedly, Titan Machinery 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 Titan Machinery will offset losses from the drop in Titan Machinery's long position.| Boyd Gaming vs. Titan Machinery | Boyd Gaming vs. Daito Trust Construction | Boyd Gaming vs. COVIVIO HOTELS INH | Boyd Gaming vs. WIMFARM SA EO |
| Titan Machinery vs. Indutrade AB | Titan Machinery vs. Superior Plus Corp | Titan Machinery vs. NMI Holdings | Titan Machinery vs. Origin Agritech |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |