Correlation Between Integral and Brunswick

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

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

Diversification Opportunities for Integral and Brunswick

0.25

Correlation Coefficient

Integral  Brunswick

Modest diversification

The 3 months correlation between Integral and Brunswick is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Integral Ad Science and Brunswick in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunswick and Integral 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 Integral Ad Science are associated (or correlated) with Brunswick. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunswick has no effect on the direction of Integral i.e., Integral and Brunswick go up and down completely randomly.

Pair Corralation between Integral and Brunswick

Considering the 90-day investment horizon Integral Ad Science is expected to generate 1.36 times more return on investment than Brunswick. However, Integral is 1.36 times more volatile than Brunswick. It trades about 0.02 of its potential returns per unit of risk. Brunswick is currently generating about 0.02 per unit of risk. If you would invest  1,090  in Integral Ad Science on September 12, 2024 and sell it today you would earn a total of  5.00  from holding Integral Ad Science or generate 0.46% return on investment over 90 days.

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

Integral Ad Science  vs.  Brunswick

Integral Ad Science

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Integral Ad Science are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Integral is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Brunswick

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Brunswick are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Brunswick is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Integral and Brunswick

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

The idea behind Integral Ad Science and Brunswick 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.