Correlation Between Boyd Gaming and 50247VAB5

Can any of the company-specific risk be diversified away by investing in both Boyd Gaming and 50247VAB5 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 50247VAB5 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Boyd Gaming and LYB INTL FIN, you can compare the effects of market volatilities on Boyd Gaming and 50247VAB5 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 50247VAB5. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and 50247VAB5.

Diversification Opportunities for Boyd Gaming and 50247VAB5

-0.26

Correlation Coefficient

Boyd Gaming  50247VAB5

Very good diversification

The 3 months correlation between Boyd and 50247VAB5 is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and LYB INTL FIN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LYB INTL FIN 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 50247VAB5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LYB INTL FIN has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and 50247VAB5 go up and down completely randomly.

Pair Corralation between Boyd Gaming and 50247VAB5

Considering the 90-day investment horizon Boyd Gaming is expected to under-perform the 50247VAB5. In addition to that, Boyd Gaming is 1.28 times more volatile than LYB INTL FIN. It trades about -0.05 of its total potential returns per unit of risk. LYB INTL FIN is currently generating about 0.09 per unit of volatility. If you would invest  9,074  in LYB INTL FIN on December 24, 2024 and sell it today you would earn a total of  440.00  from holding LYB INTL FIN or generate 4.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	80.33%
Values	Daily Returns

Boyd Gaming  vs.  LYB INTL FIN

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 rather sound basic indicators, Boyd Gaming is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

LYB INTL FIN

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in LYB INTL FIN are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, 50247VAB5 may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Boyd Gaming and 50247VAB5

The main advantage of trading using opposite Boyd Gaming and 50247VAB5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boyd Gaming position performs unexpectedly, 50247VAB5 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 50247VAB5 will offset losses from the drop in 50247VAB5's long position.

The idea behind Boyd Gaming and LYB INTL FIN 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.