Correlation Between BOS Better and Ameren Illinois
Can any of the company-specific risk be diversified away by investing in both BOS Better and Ameren Illinois 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 BOS Better and Ameren Illinois into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BOS Better Online and Ameren Illinois, you can compare the effects of market volatilities on BOS Better and Ameren Illinois 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 BOS Better with a short position of Ameren Illinois. Check out your portfolio center. Please also check ongoing floating volatility patterns of BOS Better and Ameren Illinois.
Diversification Opportunities for BOS Better and Ameren Illinois
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BOS and Ameren is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding BOS Better Online and Ameren Illinois in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameren Illinois and BOS Better 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 BOS Better Online are associated (or correlated) with Ameren Illinois. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameren Illinois has no effect on the direction of BOS Better i.e., BOS Better and Ameren Illinois go up and down completely randomly.
Pair Corralation between BOS Better and Ameren Illinois
Given the investment horizon of 90 days BOS Better Online is expected to generate 1.01 times more return on investment than Ameren Illinois. However, BOS Better is 1.01 times more volatile than Ameren Illinois. It trades about 0.4 of its potential returns per unit of risk. Ameren Illinois is currently generating about 0.05 per unit of risk. If you would invest 309.00 in BOS Better Online on September 15, 2024 and sell it today you would earn a total of 34.00 from holding BOS Better Online or generate 11.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BOS Better Online vs. Ameren Illinois
Performance |
| Timeline |
| BOS Better Online |
| Ameren Illinois |
BOS Better and Ameren Illinois Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BOS Better and Ameren Illinois
The main advantage of trading using opposite BOS Better and Ameren Illinois positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BOS Better position performs unexpectedly, Ameren Illinois 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 Ameren Illinois will offset losses from the drop in Ameren Illinois' long position.| BOS Better vs. Passage Bio | BOS Better vs. Black Diamond Therapeutics | BOS Better vs. Alector | BOS Better vs. Century Therapeutics |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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