Correlation Between BigBearai Holdings and Calbee

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

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

Diversification Opportunities for BigBearai Holdings and Calbee

-0.38

Correlation Coefficient

BigBearai Holdings  Calbee

Very good diversification

The 3 months correlation between BigBearai and Calbee is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding BigBearai Holdings and Calbee Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calbee Inc and BigBearai Holdings 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 BigBearai Holdings are associated (or correlated) with Calbee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calbee Inc has no effect on the direction of BigBearai Holdings i.e., BigBearai Holdings and Calbee go up and down completely randomly.

Pair Corralation between BigBearai Holdings and Calbee

Given the investment horizon of 90 days BigBearai Holdings is expected to generate 1.91 times more return on investment than Calbee. However, BigBearai Holdings is 1.91 times more volatile than Calbee Inc. It trades about 0.17 of its potential returns per unit of risk. Calbee Inc is currently generating about -0.03 per unit of risk. If you would invest  158.00  in BigBearai Holdings on September 20, 2024 and sell it today you would earn a total of  155.00  from holding BigBearai Holdings or generate 98.1% return on investment over 90 days.

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

BigBearai Holdings  vs.  Calbee Inc

BigBearai Holdings

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BigBearai Holdings are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, BigBearai Holdings demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Calbee Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Calbee Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with BigBearai Holdings and Calbee

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

The idea behind BigBearai Holdings and Calbee Inc 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.