Correlation Between Burlington Stores and GAMING FAC
Can any of the company-specific risk be diversified away by investing in both Burlington Stores and GAMING FAC 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 Burlington Stores and GAMING FAC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burlington Stores and GAMING FAC SA, you can compare the effects of market volatilities on Burlington Stores and GAMING FAC 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 Burlington Stores with a short position of GAMING FAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burlington Stores and GAMING FAC.
Diversification Opportunities for Burlington Stores and GAMING FAC
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Burlington and GAMING is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Burlington Stores and GAMING FAC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAMING FAC SA and Burlington Stores 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 Burlington Stores are associated (or correlated) with GAMING FAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAMING FAC SA has no effect on the direction of Burlington Stores i.e., Burlington Stores and GAMING FAC go up and down completely randomly.
Pair Corralation between Burlington Stores and GAMING FAC
Assuming the 90 days trading horizon Burlington Stores is expected to under-perform the GAMING FAC. But the stock apears to be less risky and, when comparing its historical volatility, Burlington Stores is 1.82 times less risky than GAMING FAC. The stock trades about -0.08 of its potential returns per unit of risk. The GAMING FAC SA is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 154.00 in GAMING FAC SA on October 25, 2024 and sell it today you would earn a total of 22.00 from holding GAMING FAC SA or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Burlington Stores vs. GAMING FAC SA
Performance |
| Timeline |
| Burlington Stores |
| GAMING FAC SA |
Burlington Stores and GAMING FAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burlington Stores and GAMING FAC
The main advantage of trading using opposite Burlington Stores and GAMING FAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burlington Stores position performs unexpectedly, GAMING FAC 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 GAMING FAC will offset losses from the drop in GAMING FAC's long position.| Burlington Stores vs. Apple Inc | Burlington Stores vs. Apple Inc | Burlington Stores vs. Apple Inc | Burlington Stores vs. Apple Inc |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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