Correlation Between Boat Rocker and Dividend

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

By analyzing existing cross correlation between Boat Rocker Media and Dividend 15 Split, you can compare the effects of market volatilities on Boat Rocker and Dividend 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 Boat Rocker with a short position of Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boat Rocker and Dividend.

Diversification Opportunities for Boat Rocker and Dividend

-0.92

Correlation Coefficient

Boat Rocker  Dividend

Pay attention - limited upside

The 3 months correlation between Boat and Dividend is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding Boat Rocker Media and Dividend 15 Split in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dividend 15 Split and Boat Rocker 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 Boat Rocker Media are associated (or correlated) with Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dividend 15 Split has no effect on the direction of Boat Rocker i.e., Boat Rocker and Dividend go up and down completely randomly.

Pair Corralation between Boat Rocker and Dividend

Assuming the 90 days trading horizon Boat Rocker Media is expected to under-perform the Dividend. In addition to that, Boat Rocker is 14.53 times more volatile than Dividend 15 Split. It trades about -0.05 of its total potential returns per unit of risk. Dividend 15 Split is currently generating about 0.16 per unit of volatility. If you would invest  846.00  in Dividend 15 Split on October 11, 2024 and sell it today you would earn a total of  206.00  from holding Dividend 15 Split or generate 24.35% return on investment over 90 days.

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

Boat Rocker Media  vs.  Dividend 15 Split

Boat Rocker Media

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Boat Rocker Media has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Dividend 15 Split

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dividend 15 Split are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Dividend is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Boat Rocker and Dividend

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

The idea behind Boat Rocker Media and Dividend 15 Split 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.