Correlation Between MYT Netherlands and BOS Better
Can any of the company-specific risk be diversified away by investing in both MYT Netherlands 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 MYT Netherlands and BOS Better into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MYT Netherlands Parent and BOS Better Online, you can compare the effects of market volatilities on MYT Netherlands 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 MYT Netherlands with a short position of BOS Better. Check out your portfolio center. Please also check ongoing floating volatility patterns of MYT Netherlands and BOS Better.
Diversification Opportunities for MYT Netherlands and BOS Better
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MYT and BOS is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding MYT Netherlands Parent 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 MYT Netherlands 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 MYT Netherlands Parent 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 MYT Netherlands i.e., MYT Netherlands and BOS Better go up and down completely randomly.
Pair Corralation between MYT Netherlands and BOS Better
Given the investment horizon of 90 days MYT Netherlands Parent is expected to generate 2.62 times more return on investment than BOS Better. However, MYT Netherlands is 2.62 times more volatile than BOS Better Online. It trades about 0.11 of its potential returns per unit of risk. BOS Better Online is currently generating about 0.09 per unit of risk. If you would invest 344.00 in MYT Netherlands Parent on November 21, 2024 and sell it today you would earn a total of 766.00 from holding MYT Netherlands Parent or generate 222.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
MYT Netherlands Parent vs. BOS Better Online
Performance |
Timeline |
MYT Netherlands Parent |
BOS Better Online |
MYT Netherlands and BOS Better Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MYT Netherlands and BOS Better
The main advantage of trading using opposite MYT Netherlands and BOS Better positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MYT Netherlands 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.MYT Netherlands vs. Movado Group | ||
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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