Correlation Between BG Staffing and Robert Half

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

By analyzing existing cross correlation between BG Staffing and Robert Half International, you can compare the effects of market volatilities on BG Staffing and Robert Half 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 Robert Half. Check out your portfolio center. Please also check ongoing floating volatility patterns of BG Staffing and Robert Half.

Diversification Opportunities for BG Staffing and Robert Half

0.86

Correlation Coefficient

BG Staffing  Robert Half

Very poor diversification

The 3 months correlation between BGSF and Robert is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding BG Staffing and Robert Half International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robert Half International 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 Robert Half. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robert Half International has no effect on the direction of BG Staffing i.e., BG Staffing and Robert Half go up and down completely randomly.

Pair Corralation between BG Staffing and Robert Half

Given the investment horizon of 90 days BG Staffing is expected to under-perform the Robert Half. In addition to that, BG Staffing is 1.16 times more volatile than Robert Half International. It trades about -0.24 of its total potential returns per unit of risk. Robert Half International is currently generating about -0.24 per unit of volatility. If you would invest  7,541  in Robert Half International on February 4, 2024 and sell it today you would lose (525.00) from holding Robert Half International or give up 6.96% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.65%
Values	Daily Returns

BG Staffing  vs.  Robert Half International

BG Staffing

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BG Staffing has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in June 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Robert Half International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Robert Half International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with BG Staffing and Robert Half

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

The idea behind BG Staffing and Robert Half International 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.

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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.