Correlation Between BG Staffing and Mastech Holdings
Can any of the company-specific risk be diversified away by investing in both BG Staffing and Mastech Holdings 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 BG Staffing and Mastech Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BG Staffing and Mastech Holdings, you can compare the effects of market volatilities on BG Staffing and Mastech Holdings 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 BG Staffing with a short position of Mastech Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of BG Staffing and Mastech Holdings.
Diversification Opportunities for BG Staffing and Mastech Holdings
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BGSF and Mastech is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding BG Staffing and Mastech Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mastech Holdings and BG Staffing 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 BG Staffing are associated (or correlated) with Mastech Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mastech Holdings has no effect on the direction of BG Staffing i.e., BG Staffing and Mastech Holdings go up and down completely randomly.
Pair Corralation between BG Staffing and Mastech Holdings
Given the investment horizon of 90 days BG Staffing is expected to generate 0.68 times more return on investment than Mastech Holdings. However, BG Staffing is 1.48 times less risky than Mastech Holdings. It trades about -0.02 of its potential returns per unit of risk. Mastech Holdings is currently generating about -0.04 per unit of risk. If you would invest 1,196 in BG Staffing on January 24, 2024 and sell it today you would lose (292.00) from holding BG Staffing or give up 24.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BG Staffing vs. Mastech Holdings
Performance |
| Timeline |
| BG Staffing |
| Mastech Holdings |
BG Staffing and Mastech Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BG Staffing and Mastech Holdings
The main advantage of trading using opposite BG Staffing and Mastech Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BG Staffing position performs unexpectedly, Mastech Holdings 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 Mastech Holdings will offset losses from the drop in Mastech Holdings' long position.| BG Staffing vs. Kelly Services A | BG Staffing vs. Korn Ferry | BG Staffing vs. Heidrick Struggles International | BG Staffing vs. Hudson Global |
| Mastech Holdings vs. EVI Industries | Mastech Holdings vs. LGL Group | Mastech Holdings vs. BG Staffing | Mastech Holdings vs. Issuer Direct Corp |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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