Correlation Between Ihuman and Biglari Holdings
Can any of the company-specific risk be diversified away by investing in both Ihuman and Biglari Holdings 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 Ihuman and Biglari Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ihuman Inc and Biglari Holdings, you can compare the effects of market volatilities on Ihuman and Biglari Holdings 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 Ihuman with a short position of Biglari Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihuman and Biglari Holdings.
Diversification Opportunities for Ihuman and Biglari Holdings
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ihuman and Biglari is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Ihuman Inc and Biglari Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biglari Holdings and Ihuman 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 Ihuman Inc are associated (or correlated) with Biglari Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biglari Holdings has no effect on the direction of Ihuman i.e., Ihuman and Biglari Holdings go up and down completely randomly.
Pair Corralation between Ihuman and Biglari Holdings
Allowing for the 90-day total investment horizon Ihuman Inc is expected to under-perform the Biglari Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Ihuman Inc is 1.11 times less risky than Biglari Holdings. The stock trades about -0.01 of its potential returns per unit of risk. The Biglari Holdings is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 18,548 in Biglari Holdings on September 13, 2024 and sell it today you would earn a total of 5,062 from holding Biglari Holdings or generate 27.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ihuman Inc vs. Biglari Holdings
Performance |
| Timeline |
| Ihuman Inc |
| Biglari Holdings |
Ihuman and Biglari Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ihuman and Biglari Holdings
The main advantage of trading using opposite Ihuman and Biglari Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ihuman position performs unexpectedly, Biglari Holdings 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 Biglari Holdings will offset losses from the drop in Biglari Holdings' long position.| Ihuman vs. Boqii Holding Limited | Ihuman vs. Lixiang Education Holding | Ihuman vs. Huize Holding | Ihuman vs. Kuke Music Holding |
| Biglari Holdings vs. Cannae Holdings | Biglari Holdings vs. BJs Restaurants | Biglari Holdings vs. Ark Restaurants Corp | Biglari Holdings vs. Noble Romans |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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