Correlation Between Bilfinger and BOSTON BEER
Can any of the company-specific risk be diversified away by investing in both Bilfinger and BOSTON BEER 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 Bilfinger and BOSTON BEER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bilfinger SE and BOSTON BEER A , you can compare the effects of market volatilities on Bilfinger and BOSTON BEER 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 Bilfinger with a short position of BOSTON BEER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bilfinger and BOSTON BEER.
Diversification Opportunities for Bilfinger and BOSTON BEER
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bilfinger and BOSTON is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Bilfinger SE and BOSTON BEER A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOSTON BEER A and Bilfinger 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 Bilfinger SE are associated (or correlated) with BOSTON BEER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOSTON BEER A has no effect on the direction of Bilfinger i.e., Bilfinger and BOSTON BEER go up and down completely randomly.
Pair Corralation between Bilfinger and BOSTON BEER
Assuming the 90 days trading horizon Bilfinger SE is expected to under-perform the BOSTON BEER. In addition to that, Bilfinger is 1.29 times more volatile than BOSTON BEER A . It trades about -0.04 of its total potential returns per unit of risk. BOSTON BEER A is currently generating about 0.24 per unit of volatility. If you would invest 24,960 in BOSTON BEER A on September 13, 2024 and sell it today you would earn a total of 4,740 from holding BOSTON BEER A or generate 18.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
Bilfinger SE vs. BOSTON BEER A
Performance |
| Timeline |
| Bilfinger SE |
| BOSTON BEER A |
Bilfinger and BOSTON BEER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bilfinger and BOSTON BEER
The main advantage of trading using opposite Bilfinger and BOSTON BEER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bilfinger position performs unexpectedly, BOSTON BEER 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 BOSTON BEER will offset losses from the drop in BOSTON BEER's long position.| Bilfinger vs. Sumitomo Rubber Industries | Bilfinger vs. Summit Materials | Bilfinger vs. Eagle Materials | Bilfinger vs. Mitsubishi Materials |
| BOSTON BEER vs. Apple Inc | BOSTON BEER vs. Apple Inc | BOSTON BEER vs. Apple Inc | BOSTON BEER vs. Apple Inc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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