Correlation Between Bt Brands and Ballys Corp

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

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

Diversification Opportunities for Bt Brands and Ballys Corp

-0.2

Correlation Coefficient

Bt Brands  Ballys Corp

Good diversification

The 3 months correlation between BTBD and Ballys is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Bt Brands and Ballys Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ballys Corp and Bt Brands 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 Bt Brands are associated (or correlated) with Ballys Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ballys Corp has no effect on the direction of Bt Brands i.e., Bt Brands and Ballys Corp go up and down completely randomly.

Pair Corralation between Bt Brands and Ballys Corp

Given the investment horizon of 90 days Bt Brands is expected to generate 4.9 times less return on investment than Ballys Corp. But when comparing it to its historical volatility, Bt Brands is 1.26 times less risky than Ballys Corp. It trades about 0.01 of its potential returns per unit of risk. Ballys Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  1,768  in Ballys Corp on December 19, 2024 and sell it today you would lose (84.00) from holding Ballys Corp or give up 4.75% of portfolio value over 90 days.

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

Bt Brands  vs.  Ballys Corp

Bt Brands

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bt Brands has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental drivers, Bt Brands is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Ballys Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ballys Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent essential indicators, Ballys Corp may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Bt Brands and Ballys Corp

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

The idea behind Bt Brands and Ballys Corp 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.