Correlation Between Guidewire Software, and Burlington Stores,

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

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

Diversification Opportunities for Guidewire Software, and Burlington Stores,

0.04

Correlation Coefficient

Guidewire Software,  Burlington Stores,

Significant diversification

The 3 months correlation between Guidewire and Burlington is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Guidewire Software, and Burlington Stores, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burlington Stores, and Guidewire Software, 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 Guidewire Software, are associated (or correlated) with Burlington Stores,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burlington Stores, has no effect on the direction of Guidewire Software, i.e., Guidewire Software, and Burlington Stores, go up and down completely randomly.

Pair Corralation between Guidewire Software, and Burlington Stores,

Assuming the 90 days trading horizon Guidewire Software, is expected to under-perform the Burlington Stores,. But the stock apears to be less risky and, when comparing its historical volatility, Guidewire Software, is 1.53 times less risky than Burlington Stores,. The stock trades about -0.34 of its potential returns per unit of risk. The Burlington Stores, is currently generating about -0.13 of returns per unit of risk over similar time horizon. If you would invest  5,844  in Burlington Stores, on October 23, 2024 and sell it today you would lose (142.00) from holding Burlington Stores, or give up 2.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	76.92%
Values	Daily Returns

Guidewire Software,  vs.  Burlington Stores,

Guidewire Software,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Guidewire Software, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Guidewire Software, is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Burlington Stores,

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Burlington Stores, are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Burlington Stores, sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Guidewire Software, and Burlington Stores,

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

The idea behind Guidewire Software, and Burlington Stores, 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.