Correlation Between Imperial Metals and Boyd Gaming
Can any of the company-specific risk be diversified away by investing in both Imperial Metals 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 Imperial Metals and Boyd Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Imperial Metals and Boyd Gaming, you can compare the effects of market volatilities on Imperial Metals 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 Imperial Metals with a short position of Boyd Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imperial Metals and Boyd Gaming.
Diversification Opportunities for Imperial Metals and Boyd Gaming
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Imperial and Boyd is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Imperial Metals and Boyd Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyd Gaming and Imperial Metals 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 Imperial Metals 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 Imperial Metals i.e., Imperial Metals and Boyd Gaming go up and down completely randomly.
Pair Corralation between Imperial Metals and Boyd Gaming
Assuming the 90 days horizon Imperial Metals is expected to generate 1.38 times less return on investment than Boyd Gaming. In addition to that, Imperial Metals is 1.73 times more volatile than Boyd Gaming. It trades about 0.01 of its total potential returns per unit of risk. Boyd Gaming is currently generating about 0.03 per unit of volatility. If you would invest 5,766 in Boyd Gaming on August 26, 2024 and sell it today you would earn a total of 1,467 from holding Boyd Gaming or generate 25.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Imperial Metals vs. Boyd Gaming
Performance |
| Timeline |
| Imperial Metals |
| Boyd Gaming |
Imperial Metals and Boyd Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imperial Metals and Boyd Gaming
The main advantage of trading using opposite Imperial Metals and Boyd Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imperial Metals 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.| Imperial Metals vs. Ascendant Resources | Imperial Metals vs. Cantex Mine Development | Imperial Metals vs. Amarc Resources | Imperial Metals vs. Sterling Metals Corp |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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