Pair Correlation Between Best Buy and Alcoa

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

Pair Volatility

Considering 30-days investment horizon, Best Buy Co Inc is expected to under-perform the Alcoa. In addition to that, Best Buy is 1.52 times more volatile than Alcoa Corporation. It trades about -0.08 of its total potential returns per unit of risk. Alcoa Corporation is currently generating about 0.19 per unit of volatility. If you would invest  4,491  in Alcoa Corporation on September 18, 2017 and sell it today you would earn a total of  286  from holding Alcoa Corporation or generate 6.37% return on investment over 30 days.

Correlation Coefficient

Pair Corralation between Best Buy and Alcoa
0.21

Parameters

Time Period1 Month [change]
DirectionPositive 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Diversification

Modest diversification

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

Comparative Volatility

 Predicted Return Density 
      Returns 

Best Buy Co

  
0 

Risk-Adjusted Performance

Over the last 30 days Best Buy Co Inc has generated negative risk-adjusted returns adding no value to investors with long positions.

Alcoa

  
13 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Alcoa Corporation are ranked lower than 13 (%) of all global equities and portfolios over the last 30 days.