Correlation Between Walgreens Boots and Teb Bancorp
Can any of the company-specific risk be diversified away by investing in both Walgreens Boots and Teb Bancorp 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 Walgreens Boots and Teb Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walgreens Boots Alliance and Teb Bancorp, you can compare the effects of market volatilities on Walgreens Boots and Teb Bancorp 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 Walgreens Boots with a short position of Teb Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walgreens Boots and Teb Bancorp.
Diversification Opportunities for Walgreens Boots and Teb Bancorp
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Walgreens and Teb is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Walgreens Boots Alliance and Teb Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teb Bancorp and Walgreens Boots 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 Walgreens Boots Alliance are associated (or correlated) with Teb Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teb Bancorp has no effect on the direction of Walgreens Boots i.e., Walgreens Boots and Teb Bancorp go up and down completely randomly.
Pair Corralation between Walgreens Boots and Teb Bancorp
Considering the 90-day investment horizon Walgreens Boots is expected to generate 3.34 times less return on investment than Teb Bancorp. But when comparing it to its historical volatility, Walgreens Boots Alliance is 1.37 times less risky than Teb Bancorp. It trades about 0.07 of its potential returns per unit of risk. Teb Bancorp is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 650.00 in Teb Bancorp on September 24, 2024 and sell it today you would earn a total of 148.00 from holding Teb Bancorp or generate 22.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walgreens Boots Alliance vs. Teb Bancorp
Performance |
| Timeline |
| Walgreens Boots Alliance |
| Teb Bancorp |
Walgreens Boots and Teb Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walgreens Boots and Teb Bancorp
The main advantage of trading using opposite Walgreens Boots and Teb Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walgreens Boots position performs unexpectedly, Teb Bancorp 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 Teb Bancorp will offset losses from the drop in Teb Bancorp's long position.| Walgreens Boots vs. Leafly Holdings | Walgreens Boots vs. WM Technology | Walgreens Boots vs. Revelation Biosciences | Walgreens Boots vs. AEye Inc |
| Teb Bancorp vs. Banco Bradesco SA | Teb Bancorp vs. Itau Unibanco Banco | Teb Bancorp vs. Lloyds Banking Group | Teb Bancorp vs. Deutsche Bank AG |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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