Correlation Between Beazer Homes and One Media

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

By analyzing existing cross correlation between Beazer Homes USA and One Media iP, you can compare the effects of market volatilities on Beazer Homes and One Media 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 Beazer Homes with a short position of One Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beazer Homes and One Media.

Diversification Opportunities for Beazer Homes and One Media

-0.09

Correlation Coefficient

Beazer Homes  One Media

Good diversification

The 3 months correlation between Beazer and One is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Beazer Homes USA and One Media iP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on One Media iP and Beazer Homes 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 Beazer Homes USA are associated (or correlated) with One Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of One Media iP has no effect on the direction of Beazer Homes i.e., Beazer Homes and One Media go up and down completely randomly.

Pair Corralation between Beazer Homes and One Media

Assuming the 90 days trading horizon Beazer Homes USA is expected to generate 3.18 times more return on investment than One Media. However, Beazer Homes is 3.18 times more volatile than One Media iP. It trades about 0.23 of its potential returns per unit of risk. One Media iP is currently generating about 0.21 per unit of risk. If you would invest  1,887  in Beazer Homes USA on April 23, 2025 and sell it today you would earn a total of  587.00  from holding Beazer Homes USA or generate 31.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	59.68%
Values	Daily Returns

Beazer Homes USA  vs.  One Media iP

Beazer Homes USA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Beazer Homes USA are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Beazer Homes unveiled solid returns over the last few months and may actually be approaching a breakup point.

One Media iP

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in One Media iP are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, One Media unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Beazer Homes and One Media

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

The idea behind Beazer Homes USA and One Media iP 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.