Correlation Between Boomer Holdings and Winmark
Can any of the company-specific risk be diversified away by investing in both Boomer Holdings and Winmark 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 Boomer Holdings and Winmark into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boomer Holdings and Winmark, you can compare the effects of market volatilities on Boomer Holdings and Winmark 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 Boomer Holdings with a short position of Winmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boomer Holdings and Winmark.
Diversification Opportunities for Boomer Holdings and Winmark
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boomer and Winmark is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Boomer Holdings and Winmark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Winmark and Boomer Holdings 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 Boomer Holdings are associated (or correlated) with Winmark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Winmark has no effect on the direction of Boomer Holdings i.e., Boomer Holdings and Winmark go up and down completely randomly.
Pair Corralation between Boomer Holdings and Winmark
If you would invest 37,021 in Winmark on August 27, 2024 and sell it today you would earn a total of 3,306 from holding Winmark or generate 8.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Boomer Holdings vs. Winmark
Performance |
| Timeline |
| Boomer Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Winmark |
Boomer Holdings and Winmark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boomer Holdings and Winmark
The main advantage of trading using opposite Boomer Holdings and Winmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boomer Holdings position performs unexpectedly, Winmark 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 Winmark will offset losses from the drop in Winmark's long position.The idea behind Boomer Holdings and Winmark pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Winmark vs. Mesa Laboratories | Winmark vs. Utah Medical Products | Winmark vs. Weyco Group | Winmark vs. Diamond Hill Investment |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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