Correlation Between Boyd Gaming and Aquestive Therapeutics
Can any of the company-specific risk be diversified away by investing in both Boyd Gaming and Aquestive Therapeutics 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 Boyd Gaming and Aquestive Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boyd Gaming and Aquestive Therapeutics, you can compare the effects of market volatilities on Boyd Gaming and Aquestive Therapeutics 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 Boyd Gaming with a short position of Aquestive Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and Aquestive Therapeutics.
Diversification Opportunities for Boyd Gaming and Aquestive Therapeutics
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Boyd and Aquestive is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and Aquestive Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquestive Therapeutics and Boyd Gaming 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 Boyd Gaming are associated (or correlated) with Aquestive Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquestive Therapeutics has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and Aquestive Therapeutics go up and down completely randomly.
Pair Corralation between Boyd Gaming and Aquestive Therapeutics
Considering the 90-day investment horizon Boyd Gaming is expected to generate 1.99 times less return on investment than Aquestive Therapeutics. But when comparing it to its historical volatility, Boyd Gaming is 2.7 times less risky than Aquestive Therapeutics. It trades about 0.16 of its potential returns per unit of risk. Aquestive Therapeutics is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 294.00 in Aquestive Therapeutics on September 1, 2024 and sell it today you would earn a total of 215.00 from holding Aquestive Therapeutics or generate 73.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boyd Gaming vs. Aquestive Therapeutics
Performance |
| Timeline |
| Boyd Gaming |
| Aquestive Therapeutics |
Boyd Gaming and Aquestive Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boyd Gaming and Aquestive Therapeutics
The main advantage of trading using opposite Boyd Gaming and Aquestive Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boyd Gaming position performs unexpectedly, Aquestive Therapeutics 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 Aquestive Therapeutics will offset losses from the drop in Aquestive Therapeutics' long position.| Boyd Gaming vs. MGM Resorts International | Boyd Gaming vs. Las Vegas Sands | Boyd Gaming vs. Wynn Resorts Limited | Boyd Gaming vs. Penn National Gaming |
| Aquestive Therapeutics vs. Evoke Pharma | Aquestive Therapeutics vs. Dynavax Technologies | Aquestive Therapeutics vs. Amphastar P | Aquestive Therapeutics vs. Lantheus Holdings |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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