Correlation Between Bristol Myers and 50249AAJ2
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By analyzing existing cross correlation between Bristol Myers Squibb and LYB INTERNATIONAL FINANCE, you can compare the effects of market volatilities on Bristol Myers and 50249AAJ2 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 Bristol Myers with a short position of 50249AAJ2. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bristol Myers and 50249AAJ2.
Diversification Opportunities for Bristol Myers and 50249AAJ2
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bristol and 50249AAJ2 is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Bristol Myers Squibb and LYB INTERNATIONAL FINANCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LYB INTERNATIONAL FINANCE and Bristol Myers 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 Bristol Myers Squibb are associated (or correlated) with 50249AAJ2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LYB INTERNATIONAL FINANCE has no effect on the direction of Bristol Myers i.e., Bristol Myers and 50249AAJ2 go up and down completely randomly.
Pair Corralation between Bristol Myers and 50249AAJ2
Assuming the 90 days horizon Bristol Myers Squibb is expected to generate 3.44 times more return on investment than 50249AAJ2. However, Bristol Myers is 3.44 times more volatile than LYB INTERNATIONAL FINANCE. It trades about 0.07 of its potential returns per unit of risk. LYB INTERNATIONAL FINANCE is currently generating about 0.05 per unit of risk. If you would invest 73,861 in Bristol Myers Squibb on September 24, 2024 and sell it today you would earn a total of 26,028 from holding Bristol Myers Squibb or generate 35.24% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 96.97% |
Values | Daily Returns |
Bristol Myers Squibb vs. LYB INTERNATIONAL FINANCE
Performance |
Timeline |
Bristol Myers Squibb |
LYB INTERNATIONAL FINANCE |
Bristol Myers and 50249AAJ2 Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bristol Myers and 50249AAJ2
The main advantage of trading using opposite Bristol Myers and 50249AAJ2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bristol Myers position performs unexpectedly, 50249AAJ2 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 50249AAJ2 will offset losses from the drop in 50249AAJ2's long position.Bristol Myers vs. Novartis AG | Bristol Myers vs. Bayer AG | Bristol Myers vs. Astellas Pharma | Bristol Myers vs. Roche Holding AG |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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