Correlation Between Boston Partners and Easterly Snow
Can any of the company-specific risk be diversified away by investing in both Boston Partners and Easterly Snow 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 Boston Partners and Easterly Snow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Partners Longshort and Easterly Snow Longshort, you can compare the effects of market volatilities on Boston Partners and Easterly Snow 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 Boston Partners with a short position of Easterly Snow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Partners and Easterly Snow.
Diversification Opportunities for Boston Partners and Easterly Snow
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Boston and Easterly is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Boston Partners Longshort and Easterly Snow Longshort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easterly Snow Longshort and Boston Partners 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 Boston Partners Longshort are associated (or correlated) with Easterly Snow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easterly Snow Longshort has no effect on the direction of Boston Partners i.e., Boston Partners and Easterly Snow go up and down completely randomly.
Pair Corralation between Boston Partners and Easterly Snow
Assuming the 90 days horizon Boston Partners Longshort is expected to generate 0.55 times more return on investment than Easterly Snow. However, Boston Partners Longshort is 1.81 times less risky than Easterly Snow. It trades about 0.14 of its potential returns per unit of risk. Easterly Snow Longshort is currently generating about 0.02 per unit of risk. If you would invest 1,319 in Boston Partners Longshort on September 14, 2024 and sell it today you would earn a total of 215.00 from holding Boston Partners Longshort or generate 16.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Partners Longshort vs. Easterly Snow Longshort
Performance |
| Timeline |
| Boston Partners Longshort |
| Easterly Snow Longshort |
Boston Partners and Easterly Snow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Partners and Easterly Snow
The main advantage of trading using opposite Boston Partners and Easterly Snow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Partners position performs unexpectedly, Easterly Snow 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 Easterly Snow will offset losses from the drop in Easterly Snow's long position.| Boston Partners vs. Boston Partners Longshort | Boston Partners vs. Blackrock Midcap Index | Boston Partners vs. The Arbitrage Fund | Boston Partners vs. Calamos Market Neutral |
| Easterly Snow vs. Tfa Alphagen Growth | Easterly Snow vs. Mid Cap Growth | Easterly Snow vs. Artisan Small Cap | Easterly Snow vs. Vy Baron Growth |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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