Correlation Between Apogee Enterprises and BOS Better

Can any of the company-specific risk be diversified away by investing in both Apogee Enterprises and BOS Better 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 Apogee Enterprises and BOS Better into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Apogee Enterprises and BOS Better Online, you can compare the effects of market volatilities on Apogee Enterprises and BOS Better 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 Apogee Enterprises with a short position of BOS Better. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apogee Enterprises and BOS Better.

Diversification Opportunities for Apogee Enterprises and BOS Better

0.38

Correlation Coefficient

Apogee Enterprises  BOS Better

Weak diversification

The 3 months correlation between Apogee and BOS is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Apogee Enterprises and BOS Better Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOS Better Online and Apogee Enterprises 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 Apogee Enterprises are associated (or correlated) with BOS Better. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOS Better Online has no effect on the direction of Apogee Enterprises i.e., Apogee Enterprises and BOS Better go up and down completely randomly.

Pair Corralation between Apogee Enterprises and BOS Better

Given the investment horizon of 90 days Apogee Enterprises is expected to under-perform the BOS Better. But the stock apears to be less risky and, when comparing its historical volatility, Apogee Enterprises is 1.0 times less risky than BOS Better. The stock trades about -0.48 of its potential returns per unit of risk. The BOS Better Online is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest  338.00  in BOS Better Online on September 27, 2024 and sell it today you would lose (9.00) from holding BOS Better Online or give up 2.66% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Apogee Enterprises  vs.  BOS Better Online

Apogee Enterprises

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Apogee Enterprises are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Apogee Enterprises may actually be approaching a critical reversion point that can send shares even higher in January 2025.

BOS Better Online

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BOS Better Online are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, BOS Better may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Apogee Enterprises and BOS Better

The main advantage of trading using opposite Apogee Enterprises and BOS Better positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apogee Enterprises position performs unexpectedly, BOS Better 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 BOS Better will offset losses from the drop in BOS Better's long position.

The idea behind Apogee Enterprises and BOS Better Online pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..