Correlation Between Babcock Wilcox and Exactus

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

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

Diversification Opportunities for Babcock Wilcox and Exactus

0.0

Correlation Coefficient

Babcock Wilcox  Exactus

Pay attention - limited upside

The 3 months correlation between Babcock and Exactus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Babcock Wilcox Enterprises and Exactus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exactus and Babcock Wilcox 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 Babcock Wilcox Enterprises are associated (or correlated) with Exactus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exactus has no effect on the direction of Babcock Wilcox i.e., Babcock Wilcox and Exactus go up and down completely randomly.

Pair Corralation between Babcock Wilcox and Exactus

If you would invest  117.00  in Babcock Wilcox Enterprises on January 19, 2024 and sell it today you would lose (17.00) from holding Babcock Wilcox Enterprises or give up 14.53% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Babcock Wilcox Enterprises  vs.  Exactus

Babcock Wilcox Enter

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Babcock Wilcox Enterprises are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Babcock Wilcox may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Exactus

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Exactus has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, Exactus is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Babcock Wilcox and Exactus

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

The idea behind Babcock Wilcox Enterprises and Exactus 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.