Correlation Between Electrovaya Common and Boyd Gaming

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

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

Diversification Opportunities for Electrovaya Common and Boyd Gaming

0.48

Correlation Coefficient

Electrovaya Common  Boyd Gaming

Very weak diversification

The 3 months correlation between Electrovaya and Boyd is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Electrovaya Common Shares and Boyd Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyd Gaming and Electrovaya Common 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 Electrovaya Common Shares are associated (or correlated) with Boyd Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boyd Gaming has no effect on the direction of Electrovaya Common i.e., Electrovaya Common and Boyd Gaming go up and down completely randomly.

Pair Corralation between Electrovaya Common and Boyd Gaming

Given the investment horizon of 90 days Electrovaya Common Shares is expected to generate 4.47 times more return on investment than Boyd Gaming. However, Electrovaya Common is 4.47 times more volatile than Boyd Gaming. It trades about 0.01 of its potential returns per unit of risk. Boyd Gaming is currently generating about -0.05 per unit of risk. If you would invest  273.00  in Electrovaya Common Shares on October 8, 2024 and sell it today you would lose (5.00) from holding Electrovaya Common Shares or give up 1.83% of portfolio value over 90 days.

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

Electrovaya Common Shares  vs.  Boyd Gaming

Electrovaya Common Shares

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Electrovaya Common Shares are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Electrovaya Common sustained solid returns over the last few months and may actually be approaching a breakup point.

Boyd Gaming

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Boyd Gaming are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Boyd Gaming exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Electrovaya Common and Boyd Gaming

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

The idea behind Electrovaya Common Shares and Boyd Gaming 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.