This module allows you to analyze existing cross correlation between Best Buy Co and Sprint Corporation. You can compare the effects of market volatilities on Best Buy and Sprint 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 Sprint. See also your portfolio center. Please also check ongoing floating volatility patterns of Best Buy and Sprint.
Considering 30-days investment horizon, Best Buy is expected to generate 26.35 times less return on investment than Sprint. But when comparing it to its historical volatility, Best Buy Co is 1.4 times less risky than Sprint. It trades about 0.0 of its potential returns per unit of risk. Sprint Corporation is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 530.00 in Sprint Corporation on March 25, 2018 and sell it today you would earn a total of 56.00 from holding Sprint Corporation or generate 10.57% return on investment over 30 days.
Overlapping area represents the amount of risk that can be diversified away by holding Best Buy Co Inc and Sprint Corp. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Sprint 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 are associated (or correlated) with Sprint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprint has no effect on the direction of Best Buy i.e. Best Buy and Sprint go up and down completely randomly.
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