Correlation Between BrightView Holdings and CompoSecure
Can any of the company-specific risk be diversified away by investing in both BrightView Holdings and CompoSecure 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 BrightView Holdings and CompoSecure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BrightView Holdings and CompoSecure, you can compare the effects of market volatilities on BrightView Holdings and CompoSecure 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 BrightView Holdings with a short position of CompoSecure. Check out your portfolio center. Please also check ongoing floating volatility patterns of BrightView Holdings and CompoSecure.
Diversification Opportunities for BrightView Holdings and CompoSecure
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between BrightView and CompoSecure is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding BrightView Holdings and CompoSecure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CompoSecure and BrightView Holdings 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 BrightView Holdings are associated (or correlated) with CompoSecure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CompoSecure has no effect on the direction of BrightView Holdings i.e., BrightView Holdings and CompoSecure go up and down completely randomly.
Pair Corralation between BrightView Holdings and CompoSecure
Allowing for the 90-day total investment horizon BrightView Holdings is expected to under-perform the CompoSecure. But the stock apears to be less risky and, when comparing its historical volatility, BrightView Holdings is 1.52 times less risky than CompoSecure. The stock trades about -0.05 of its potential returns per unit of risk. The CompoSecure is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,233 in CompoSecure on May 14, 2025 and sell it today you would earn a total of 649.00 from holding CompoSecure or generate 52.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
BrightView Holdings vs. CompoSecure
Performance |
Timeline |
BrightView Holdings |
CompoSecure |
BrightView Holdings and CompoSecure Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BrightView Holdings and CompoSecure
The main advantage of trading using opposite BrightView Holdings and CompoSecure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BrightView Holdings position performs unexpectedly, CompoSecure 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 CompoSecure will offset losses from the drop in CompoSecure's long position.BrightView Holdings vs. First Advantage Corp | BrightView Holdings vs. CBIZ Inc | BrightView Holdings vs. Cass Information Systems | BrightView Holdings vs. Maximus |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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