Correlation Between Boyd Gaming and Catalyst Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Boyd Gaming and Catalyst Pharmaceuticals 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 Catalyst Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boyd Gaming and Catalyst Pharmaceuticals, you can compare the effects of market volatilities on Boyd Gaming and Catalyst Pharmaceuticals 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 Catalyst Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and Catalyst Pharmaceuticals.
Diversification Opportunities for Boyd Gaming and Catalyst Pharmaceuticals
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Boyd and Catalyst is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and Catalyst Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Pharmaceuticals 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 Catalyst Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Pharmaceuticals has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and Catalyst Pharmaceuticals go up and down completely randomly.
Pair Corralation between Boyd Gaming and Catalyst Pharmaceuticals
Considering the 90-day investment horizon Boyd Gaming is expected to generate 2.96 times less return on investment than Catalyst Pharmaceuticals. But when comparing it to its historical volatility, Boyd Gaming is 1.32 times less risky than Catalyst Pharmaceuticals. It trades about 0.04 of its potential returns per unit of risk. Catalyst Pharmaceuticals is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,539 in Catalyst Pharmaceuticals on October 12, 2024 and sell it today you would earn a total of 741.00 from holding Catalyst Pharmaceuticals or generate 48.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.47% |
| Values | Daily Returns |
Boyd Gaming vs. Catalyst Pharmaceuticals
Performance |
| Timeline |
| Boyd Gaming |
| Catalyst Pharmaceuticals |
Boyd Gaming and Catalyst Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boyd Gaming and Catalyst Pharmaceuticals
The main advantage of trading using opposite Boyd Gaming and Catalyst Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boyd Gaming position performs unexpectedly, Catalyst Pharmaceuticals 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 Catalyst Pharmaceuticals will offset losses from the drop in Catalyst Pharmaceuticals' 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 |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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