Correlation Between Boyd Gaming and News
Can any of the company-specific risk be diversified away by investing in both Boyd Gaming and News 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 News into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boyd Gaming and News Corporation, you can compare the effects of market volatilities on Boyd Gaming and News 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 News. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and News.
Diversification Opportunities for Boyd Gaming and News
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Boyd and News is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and News Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on News 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 News. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of News has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and News go up and down completely randomly.
Pair Corralation between Boyd Gaming and News
Assuming the 90 days trading horizon Boyd Gaming is expected to generate 1.31 times more return on investment than News. However, Boyd Gaming is 1.31 times more volatile than News Corporation. It trades about 0.14 of its potential returns per unit of risk. News Corporation is currently generating about 0.05 per unit of risk. If you would invest 4,908 in Boyd Gaming on September 3, 2024 and sell it today you would earn a total of 1,992 from holding Boyd Gaming or generate 40.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boyd Gaming vs. News Corp.
Performance |
| Timeline |
| Boyd Gaming |
| News |
Boyd Gaming and News Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boyd Gaming and News
The main advantage of trading using opposite Boyd Gaming and News positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boyd Gaming position performs unexpectedly, News 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 News will offset losses from the drop in News' long position.| Boyd Gaming vs. Apple Inc | Boyd Gaming vs. Apple Inc | Boyd Gaming vs. Apple Inc | Boyd Gaming vs. Apple Inc |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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