Correlation Between Boyd Gaming and PICKN PAY
Can any of the company-specific risk be diversified away by investing in both Boyd Gaming and PICKN PAY 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 PICKN PAY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boyd Gaming and PICKN PAY STORES, you can compare the effects of market volatilities on Boyd Gaming and PICKN PAY 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 PICKN PAY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and PICKN PAY.
Diversification Opportunities for Boyd Gaming and PICKN PAY
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Boyd and PICKN is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and PICKN PAY STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PICKN PAY STORES 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 PICKN PAY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PICKN PAY STORES has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and PICKN PAY go up and down completely randomly.
Pair Corralation between Boyd Gaming and PICKN PAY
Assuming the 90 days trading horizon Boyd Gaming is expected to generate 2.0 times less return on investment than PICKN PAY. But when comparing it to its historical volatility, Boyd Gaming is 1.7 times less risky than PICKN PAY. It trades about 0.06 of its potential returns per unit of risk. PICKN PAY STORES is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 103.00 in PICKN PAY STORES on October 16, 2024 and sell it today you would earn a total of 54.00 from holding PICKN PAY STORES or generate 52.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boyd Gaming vs. PICKN PAY STORES
Performance |
| Timeline |
| Boyd Gaming |
| PICKN PAY STORES |
Boyd Gaming and PICKN PAY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boyd Gaming and PICKN PAY
The main advantage of trading using opposite Boyd Gaming and PICKN PAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boyd Gaming position performs unexpectedly, PICKN PAY 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 PICKN PAY will offset losses from the drop in PICKN PAY's long position.| Boyd Gaming vs. DXC Technology Co | Boyd Gaming vs. Kingdee International Software | Boyd Gaming vs. Nomad Foods | Boyd Gaming vs. EBRO FOODS |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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