Correlation Between B Riley and Maiden Holdings
Can any of the company-specific risk be diversified away by investing in both B Riley and Maiden 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 B Riley and Maiden Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between B Riley Financial and Maiden Holdings North, you can compare the effects of market volatilities on B Riley and Maiden 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 B Riley with a short position of Maiden Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of B Riley and Maiden Holdings.
Diversification Opportunities for B Riley and Maiden Holdings
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between RILYZ and Maiden is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding B Riley Financial and Maiden Holdings North in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maiden Holdings North and B Riley 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 B Riley Financial are associated (or correlated) with Maiden Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maiden Holdings North has no effect on the direction of B Riley i.e., B Riley and Maiden Holdings go up and down completely randomly.
Pair Corralation between B Riley and Maiden Holdings
Assuming the 90 days horizon B Riley Financial is expected to generate 1.3 times more return on investment than Maiden Holdings. However, B Riley is 1.3 times more volatile than Maiden Holdings North. It trades about -0.02 of its potential returns per unit of risk. Maiden Holdings North is currently generating about -0.31 per unit of risk. If you would invest 1,022 in B Riley Financial on September 12, 2024 and sell it today you would lose (15.00) from holding B Riley Financial or give up 1.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
B Riley Financial vs. Maiden Holdings North
Performance |
| Timeline |
| B Riley Financial |
| Maiden Holdings North |
B Riley and Maiden Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with B Riley and Maiden Holdings
The main advantage of trading using opposite B Riley and Maiden Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if B Riley position performs unexpectedly, Maiden 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 Maiden Holdings will offset losses from the drop in Maiden Holdings' long position.| B Riley vs. B Riley Financial | B Riley vs. B Riley Financial | B Riley vs. B Riley Financial, | B Riley vs. B Riley Financial |
| Maiden Holdings vs. Maiden Holdings | Maiden Holdings vs. Affiliated Managers Group | Maiden Holdings vs. Entergy New Orleans | Maiden Holdings vs. American Financial Group |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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