Correlation Between Ballantyne Strong and Garmin

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

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

Diversification Opportunities for Ballantyne Strong and Garmin

0.0

Correlation Coefficient

Ballantyne Strong  Garmin

Pay attention - limited upside

The 3 months correlation between Ballantyne and Garmin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ballantyne Strong and Garmin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garmin and Ballantyne Strong 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 Ballantyne Strong are associated (or correlated) with Garmin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garmin has no effect on the direction of Ballantyne Strong i.e., Ballantyne Strong and Garmin go up and down completely randomly.

Pair Corralation between Ballantyne Strong and Garmin

If you would invest  17,520  in Garmin on October 24, 2024 and sell it today you would earn a total of  4,262  from holding Garmin or generate 24.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Ballantyne Strong  vs.  Garmin

Ballantyne Strong

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ballantyne Strong has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Ballantyne Strong is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Garmin

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Garmin are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain primary indicators, Garmin displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ballantyne Strong and Garmin

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

The idea behind Ballantyne Strong and Garmin 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.