Correlation Between B Riley and SCCG
Can any of the company-specific risk be diversified away by investing in both B Riley and SCCG 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 SCCG 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 SCCG, you can compare the effects of market volatilities on B Riley and SCCG 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 SCCG. Check out your portfolio center. Please also check ongoing floating volatility patterns of B Riley and SCCG.
Diversification Opportunities for B Riley and SCCG
Significant diversification
The 3 months correlation between RILYZ and SCCG is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding B Riley Financial and SCCG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCCG 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 SCCG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCCG has no effect on the direction of B Riley i.e., B Riley and SCCG go up and down completely randomly.
Pair Corralation between B Riley and SCCG
Assuming the 90 days horizon B Riley Financial is expected to generate 1.26 times more return on investment than SCCG. However, B Riley is 1.26 times more volatile than SCCG. It trades about 0.18 of its potential returns per unit of risk. SCCG is currently generating about -0.29 per unit of risk. If you would invest 982.00 in B Riley Financial on September 3, 2024 and sell it today you would earn a total of 67.00 from holding B Riley Financial or generate 6.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
B Riley Financial vs. SCCG
Performance |
| Timeline |
| B Riley Financial |
| SCCG |
B Riley and SCCG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with B Riley and SCCG
The main advantage of trading using opposite B Riley and SCCG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if B Riley position performs unexpectedly, SCCG 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 SCCG will offset losses from the drop in SCCG's 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 |
| SCCG vs. Sachem Capital Corp | SCCG vs. Babcock Wilcox Enterprises, | SCCG vs. B Riley Financial, | SCCG vs. B Riley Financial |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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