Correlation Between BOS Better and Beneficient

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

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

Diversification Opportunities for BOS Better and Beneficient

-0.53

Correlation Coefficient

BOS Better  Beneficient

Excellent diversification

The 3 months correlation between BOS and Beneficient is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding BOS Better Online and Beneficient Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beneficient Class and BOS Better 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 BOS Better Online are associated (or correlated) with Beneficient. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beneficient Class has no effect on the direction of BOS Better i.e., BOS Better and Beneficient go up and down completely randomly.

Pair Corralation between BOS Better and Beneficient

Given the investment horizon of 90 days BOS Better Online is expected to generate 0.67 times more return on investment than Beneficient. However, BOS Better Online is 1.5 times less risky than Beneficient. It trades about 0.1 of its potential returns per unit of risk. Beneficient Class A is currently generating about -0.22 per unit of risk. If you would invest  329.00  in BOS Better Online on December 26, 2024 and sell it today you would earn a total of  65.00  from holding BOS Better Online or generate 19.76% return on investment over 90 days.

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

BOS Better Online  vs.  Beneficient Class A

BOS Better Online

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BOS Better Online are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, BOS Better exhibited solid returns over the last few months and may actually be approaching a breakup point.

Beneficient Class

Risk-Adjusted Performance

Very Weak

Over the last 90 days Beneficient Class A has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with BOS Better and Beneficient

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

The idea behind BOS Better Online and Beneficient Class A 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.