Correlation Between British Amer and Costco Wholesale
Can any of the company-specific risk be diversified away by investing in both British Amer and Costco Wholesale 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 British Amer and Costco Wholesale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between biOasis Technologies and Costco Wholesale Corp, you can compare the effects of market volatilities on British Amer and Costco Wholesale 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 British Amer with a short position of Costco Wholesale. Check out your portfolio center. Please also check ongoing floating volatility patterns of British Amer and Costco Wholesale.
Diversification Opportunities for British Amer and Costco Wholesale
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between British and Costco is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding biOasis Technologies and Costco Wholesale Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Costco Wholesale Corp and British Amer 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 biOasis Technologies are associated (or correlated) with Costco Wholesale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Costco Wholesale Corp has no effect on the direction of British Amer i.e., British Amer and Costco Wholesale go up and down completely randomly.
Pair Corralation between British Amer and Costco Wholesale
Assuming the 90 days horizon biOasis Technologies is expected to generate 113.5 times more return on investment than Costco Wholesale. However, British Amer is 113.5 times more volatile than Costco Wholesale Corp. It trades about 0.13 of its potential returns per unit of risk. Costco Wholesale Corp is currently generating about 0.16 per unit of risk. If you would invest 1.00 in biOasis Technologies on September 2, 2024 and sell it today you would earn a total of 125.00 from holding biOasis Technologies or generate 12500.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.8% |
| Values | Daily Returns |
biOasis Technologies vs. Costco Wholesale Corp
Performance |
| Timeline |
| biOasis Technologies |
| Costco Wholesale Corp |
British Amer and Costco Wholesale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with British Amer and Costco Wholesale
The main advantage of trading using opposite British Amer and Costco Wholesale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if British Amer position performs unexpectedly, Costco Wholesale 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 Costco Wholesale will offset losses from the drop in Costco Wholesale's long position.| British Amer vs. Canadian Imperial Bank | British Amer vs. Pollard Banknote Limited | British Amer vs. US Financial 15 | British Amer vs. High Liner Foods |
| Costco Wholesale vs. Amazon CDR | Costco Wholesale vs. Berkshire Hathaway CDR | Costco Wholesale vs. UnitedHealth Group CDR | Costco Wholesale vs. Apple Inc CDR |
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.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |