Correlation Between Boyd Gaming and FMEGR

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Can any of the company-specific risk be diversified away by investing in both Boyd Gaming and FMEGR 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 FMEGR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boyd Gaming and FMEGR 3 01 DEC 31, you can compare the effects of market volatilities on Boyd Gaming and FMEGR 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 FMEGR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and FMEGR.

Diversification Opportunities for Boyd Gaming and FMEGR

0.17
  Correlation Coefficient

Average diversification

The 3 months correlation between Boyd and FMEGR is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and FMEGR 3 01 DEC 31 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FMEGR 3 01 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 FMEGR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FMEGR 3 01 has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and FMEGR go up and down completely randomly.

Pair Corralation between Boyd Gaming and FMEGR

Considering the 90-day investment horizon Boyd Gaming is expected to generate 0.86 times more return on investment than FMEGR. However, Boyd Gaming is 1.17 times less risky than FMEGR. It trades about 0.36 of its potential returns per unit of risk. FMEGR 3 01 DEC 31 is currently generating about -0.05 per unit of risk. If you would invest  6,831  in Boyd Gaming on September 3, 2024 and sell it today you would earn a total of  554.00  from holding Boyd Gaming or generate 8.11% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy40.0%
ValuesDaily Returns

Boyd Gaming  vs.  FMEGR 3 01 DEC 31

 Performance 
       Timeline  
Boyd Gaming 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Boyd Gaming are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Boyd Gaming exhibited solid returns over the last few months and may actually be approaching a breakup point.
FMEGR 3 01 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days FMEGR 3 01 DEC 31 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, FMEGR is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Boyd Gaming and FMEGR Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Boyd Gaming and FMEGR

The main advantage of trading using opposite Boyd Gaming and FMEGR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boyd Gaming position performs unexpectedly, FMEGR 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 FMEGR will offset losses from the drop in FMEGR's long position.
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The idea behind Boyd Gaming and FMEGR 3 01 DEC 31 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.

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