Correlation Between Eshallgo and Bristol Myers
Can any of the company-specific risk be diversified away by investing in both Eshallgo and Bristol Myers 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 Eshallgo and Bristol Myers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eshallgo Class A and Bristol Myers Squibb, you can compare the effects of market volatilities on Eshallgo and Bristol Myers 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 Eshallgo with a short position of Bristol Myers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eshallgo and Bristol Myers.
Diversification Opportunities for Eshallgo and Bristol Myers
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Eshallgo and Bristol is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Eshallgo Class A and Bristol Myers Squibb in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bristol Myers Squibb and Eshallgo 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 Eshallgo Class A are associated (or correlated) with Bristol Myers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bristol Myers Squibb has no effect on the direction of Eshallgo i.e., Eshallgo and Bristol Myers go up and down completely randomly.
Pair Corralation between Eshallgo and Bristol Myers
Given the investment horizon of 90 days Eshallgo Class A is expected to generate 2.69 times more return on investment than Bristol Myers. However, Eshallgo is 2.69 times more volatile than Bristol Myers Squibb. It trades about 0.4 of its potential returns per unit of risk. Bristol Myers Squibb is currently generating about 0.15 per unit of risk. If you would invest 211.00 in Eshallgo Class A on August 24, 2024 and sell it today you would earn a total of 188.00 from holding Eshallgo Class A or generate 89.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eshallgo Class A vs. Bristol Myers Squibb
Performance |
| Timeline |
| Eshallgo Class A |
| Bristol Myers Squibb |
Eshallgo and Bristol Myers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eshallgo and Bristol Myers
The main advantage of trading using opposite Eshallgo and Bristol Myers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eshallgo position performs unexpectedly, Bristol Myers 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 Bristol Myers will offset losses from the drop in Bristol Myers' long position.| Eshallgo vs. Shake Shack | Eshallgo vs. Lululemon Athletica | Eshallgo vs. Playtika Holding Corp | Eshallgo vs. Haverty Furniture Companies |
| Bristol Myers vs. Merck Company | Bristol Myers vs. Pfizer Inc | Bristol Myers vs. Eshallgo Class A | Bristol Myers vs. Amtech Systems |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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