Pair Correlation Between Best Buy and International Business

This module allows you to analyze existing cross correlation between Best Buy Co Inc and International Business Machines Corporation. You can compare the effects of market volatilities on Best Buy and International Business 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 Best Buy with a short position of International Business. See also your portfolio center. Please also check ongoing floating volatility patterns of Best Buy and International Business.
Investment Horizon     30 Days    Login   to change
Symbolsvs
 Best Buy Co. Inc.  vs   International Business Machine
 Performance (%) 
Benchmark  Embed    Timeline 

Pair Volatility

Considering 30-days investment horizon, Best Buy Co Inc is expected to generate 0.85 times more return on investment than International Business. However, Best Buy Co Inc is 1.17 times less risky than International Business. It trades about 0.51 of its potential returns per unit of risk. International Business Machines Corporation is currently generating about -0.32 per unit of risk. If you would invest  4,620  in Best Buy Co Inc on March 26, 2017 and sell it today you would earn a total of  495.00  from holding Best Buy Co Inc or generate 10.71% return on investment over 30 days.

Correlation Coefficient

Pair Corralation between Best Buy and International Business
-0.72

Parameters

Time Period1 Month [change]
DirectionNegative BBY Moved Down vs IBM
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Diversification

Pay attention

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

Comparative Volatility

 Predicted Return Density 
Benchmark  Embed    Returns 

Best Buy Co

  
35 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Best Buy Co Inc are ranked lower than 35 (%) of all global equities and portfolios over the last 30 days.

International Business

  
0 

Risk-Adjusted Performance

Over the last 30 days International Business Machines Corporation has generated negative risk-adjusted returns adding no value to investors with long positions.