Correlation Between Boyd Gaming and Apple

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

By analyzing existing cross correlation between Boyd Gaming and Apple Inc, you can compare the effects of market volatilities on Boyd Gaming and Apple 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 Boyd Gaming with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and Apple.

Diversification Opportunities for Boyd Gaming and Apple

0.69

Correlation Coefficient

Boyd Gaming  Apple

Poor diversification

The 3 months correlation between Boyd and Apple is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Boyd Gaming 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 Boyd Gaming are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and Apple go up and down completely randomly.

Pair Corralation between Boyd Gaming and Apple

Assuming the 90 days trading horizon Boyd Gaming is expected to generate 0.95 times more return on investment than Apple. However, Boyd Gaming is 1.05 times less risky than Apple. It trades about -0.06 of its potential returns per unit of risk. Apple Inc is currently generating about -0.15 per unit of risk. If you would invest  6,832  in Boyd Gaming on December 29, 2024 and sell it today you would lose (482.00) from holding Boyd Gaming or give up 7.06% of portfolio value over 90 days.

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

Boyd Gaming  vs.  Apple Inc

Boyd Gaming

Risk-Adjusted Performance

Very Weak

Over the last 90 days Boyd Gaming has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Apple Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apple Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Boyd Gaming and Apple

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

The idea behind Boyd Gaming and Apple Inc 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.

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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.