Correlation Between Boosh Plant and Paranovus Entertainment

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

By analyzing existing cross correlation between Boosh Plant Based Brands and Paranovus Entertainment Technology, you can compare the effects of market volatilities on Boosh Plant and Paranovus Entertainment 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 Boosh Plant with a short position of Paranovus Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boosh Plant and Paranovus Entertainment.

Diversification Opportunities for Boosh Plant and Paranovus Entertainment

0.59

Correlation Coefficient

Boosh Plant  Paranovus Entertainment

Very weak diversification

The 3 months correlation between Boosh and Paranovus is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Boosh Plant Based Brands and Paranovus Entertainment Techno in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paranovus Entertainment and Boosh Plant 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 Boosh Plant Based Brands are associated (or correlated) with Paranovus Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paranovus Entertainment has no effect on the direction of Boosh Plant i.e., Boosh Plant and Paranovus Entertainment go up and down completely randomly.

Pair Corralation between Boosh Plant and Paranovus Entertainment

Assuming the 90 days horizon Boosh Plant Based Brands is expected to generate 4.23 times more return on investment than Paranovus Entertainment. However, Boosh Plant is 4.23 times more volatile than Paranovus Entertainment Technology. It trades about 0.12 of its potential returns per unit of risk. Paranovus Entertainment Technology is currently generating about 0.02 per unit of risk. If you would invest  2.32  in Boosh Plant Based Brands on September 28, 2024 and sell it today you would lose (1.32) from holding Boosh Plant Based Brands or give up 56.9% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.62%
Values	Daily Returns

Boosh Plant Based Brands  vs.  Paranovus Entertainment Techno

Boosh Plant Based

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Boosh Plant Based Brands are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward indicators, Boosh Plant reported solid returns over the last few months and may actually be approaching a breakup point.

Paranovus Entertainment

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Paranovus Entertainment Technology are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, Paranovus Entertainment unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Boosh Plant and Paranovus Entertainment

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

The idea behind Boosh Plant Based Brands and Paranovus Entertainment Technology 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.