Correlation Between Boston Beer and American Virtual
Can any of the company-specific risk be diversified away by investing in both Boston Beer and American Virtual 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 Boston Beer and American Virtual into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Beer and American Virtual Cloud, you can compare the effects of market volatilities on Boston Beer and American Virtual 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 Boston Beer with a short position of American Virtual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Beer and American Virtual.
Diversification Opportunities for Boston Beer and American Virtual
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boston and American is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Boston Beer and American Virtual Cloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Virtual Cloud and Boston Beer 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 Boston Beer are associated (or correlated) with American Virtual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Virtual Cloud has no effect on the direction of Boston Beer i.e., Boston Beer and American Virtual go up and down completely randomly.
Pair Corralation between Boston Beer and American Virtual
If you would invest 26,820 in Boston Beer on September 3, 2024 and sell it today you would earn a total of 4,804 from holding Boston Beer or generate 17.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.68% |
| Values | Daily Returns |
Boston Beer vs. American Virtual Cloud
Performance |
| Timeline |
| Boston Beer |
| American Virtual Cloud |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Boston Beer and American Virtual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Beer and American Virtual
The main advantage of trading using opposite Boston Beer and American Virtual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Beer position performs unexpectedly, American Virtual 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 American Virtual will offset losses from the drop in American Virtual's long position.| Boston Beer vs. Anheuser Busch Inbev | Boston Beer vs. Molson Coors Beverage | Boston Beer vs. Heineken NV | Boston Beer vs. Ambev SA ADR |
| American Virtual vs. United Homes Group | American Virtual vs. Mid Atlantic Home Health | American Virtual vs. Newell Brands | American Virtual vs. Skechers USA |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |