Correlation Between FORMPIPE SOFTWARE and Boyd Gaming
Can any of the company-specific risk be diversified away by investing in both FORMPIPE SOFTWARE and Boyd Gaming 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 FORMPIPE SOFTWARE and Boyd Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FORMPIPE SOFTWARE AB and Boyd Gaming, you can compare the effects of market volatilities on FORMPIPE SOFTWARE and Boyd Gaming 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 FORMPIPE SOFTWARE with a short position of Boyd Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of FORMPIPE SOFTWARE and Boyd Gaming.
Diversification Opportunities for FORMPIPE SOFTWARE and Boyd Gaming
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FORMPIPE and Boyd is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding FORMPIPE SOFTWARE AB and Boyd Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyd Gaming and FORMPIPE SOFTWARE 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 FORMPIPE SOFTWARE AB are associated (or correlated) with Boyd Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boyd Gaming has no effect on the direction of FORMPIPE SOFTWARE i.e., FORMPIPE SOFTWARE and Boyd Gaming go up and down completely randomly.
Pair Corralation between FORMPIPE SOFTWARE and Boyd Gaming
Assuming the 90 days horizon FORMPIPE SOFTWARE is expected to generate 2.75 times less return on investment than Boyd Gaming. In addition to that, FORMPIPE SOFTWARE is 1.3 times more volatile than Boyd Gaming. It trades about 0.04 of its total potential returns per unit of risk. Boyd Gaming is currently generating about 0.13 per unit of volatility. If you would invest 4,952 in Boyd Gaming on October 17, 2024 and sell it today you would earn a total of 2,048 from holding Boyd Gaming or generate 41.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FORMPIPE SOFTWARE AB vs. Boyd Gaming
Performance |
| Timeline |
| FORMPIPE SOFTWARE |
| Boyd Gaming |
FORMPIPE SOFTWARE and Boyd Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FORMPIPE SOFTWARE and Boyd Gaming
The main advantage of trading using opposite FORMPIPE SOFTWARE and Boyd Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FORMPIPE SOFTWARE position performs unexpectedly, Boyd Gaming 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 Boyd Gaming will offset losses from the drop in Boyd Gaming's long position.| FORMPIPE SOFTWARE vs. OURGAME INTHOLDL 00005 | FORMPIPE SOFTWARE vs. Penta Ocean Construction Co | FORMPIPE SOFTWARE vs. Dairy Farm International | FORMPIPE SOFTWARE vs. CVW CLEANTECH INC |
| Boyd Gaming vs. Easy Software AG | Boyd Gaming vs. FORMPIPE SOFTWARE AB | Boyd Gaming vs. ASURE SOFTWARE | Boyd Gaming vs. COMPUTERSHARE |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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