Correlation Between Prologis and Boyd Gaming
Can any of the company-specific risk be diversified away by investing in both Prologis 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 Prologis and Boyd Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prologis and Boyd Gaming, you can compare the effects of market volatilities on Prologis 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 Prologis with a short position of Boyd Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prologis and Boyd Gaming.
Diversification Opportunities for Prologis and Boyd Gaming
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Prologis and Boyd is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Prologis and Boyd Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyd Gaming and Prologis 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 Prologis 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 Prologis i.e., Prologis and Boyd Gaming go up and down completely randomly.
Pair Corralation between Prologis and Boyd Gaming
Assuming the 90 days trading horizon Prologis is expected to generate 1.37 times less return on investment than Boyd Gaming. But when comparing it to its historical volatility, Prologis is 1.35 times less risky than Boyd Gaming. It trades about 0.23 of its potential returns per unit of risk. Boyd Gaming is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 6,350 in Boyd Gaming on September 1, 2024 and sell it today you would earn a total of 550.00 from holding Boyd Gaming or generate 8.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Prologis vs. Boyd Gaming
Performance |
| Timeline |
| Prologis |
| Boyd Gaming |
Prologis and Boyd Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prologis and Boyd Gaming
The main advantage of trading using opposite Prologis and Boyd Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prologis 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.| Prologis vs. FORMPIPE SOFTWARE AB | Prologis vs. RCM TECHNOLOGIES | Prologis vs. CPU SOFTWAREHOUSE | Prologis vs. FARO Technologies |
| Boyd Gaming vs. Apple Inc | Boyd Gaming vs. Apple Inc | Boyd Gaming vs. Apple Inc | Boyd Gaming 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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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