Correlation Between Marfrig Global and BOS Better
Can any of the company-specific risk be diversified away by investing in both Marfrig Global and BOS Better 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 Marfrig Global and BOS Better into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marfrig Global Foods and BOS Better Online, you can compare the effects of market volatilities on Marfrig Global and BOS Better 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 Marfrig Global with a short position of BOS Better. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfrig Global and BOS Better.
Diversification Opportunities for Marfrig Global and BOS Better
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marfrig and BOS is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Marfrig Global Foods and BOS Better Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOS Better Online and Marfrig Global 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 Marfrig Global Foods are associated (or correlated) with BOS Better. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOS Better Online has no effect on the direction of Marfrig Global i.e., Marfrig Global and BOS Better go up and down completely randomly.
Pair Corralation between Marfrig Global and BOS Better
Assuming the 90 days horizon Marfrig Global Foods is expected to generate 1.74 times more return on investment than BOS Better. However, Marfrig Global is 1.74 times more volatile than BOS Better Online. It trades about 0.08 of its potential returns per unit of risk. BOS Better Online is currently generating about 0.06 per unit of risk. If you would invest 191.00 in Marfrig Global Foods on September 2, 2024 and sell it today you would earn a total of 114.00 from holding Marfrig Global Foods or generate 59.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marfrig Global Foods vs. BOS Better Online
Performance |
| Timeline |
| Marfrig Global Foods |
| BOS Better Online |
Marfrig Global and BOS Better Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marfrig Global and BOS Better
The main advantage of trading using opposite Marfrig Global and BOS Better positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marfrig Global position performs unexpectedly, BOS Better 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 BOS Better will offset losses from the drop in BOS Better's long position.| Marfrig Global vs. The A2 Milk | Marfrig Global vs. Artisan Consumer Goods | Marfrig Global vs. General Mills |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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