Correlation Between NEW PACIFIC and DICKS Sporting
Can any of the company-specific risk be diversified away by investing in both NEW PACIFIC and DICKS Sporting 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 NEW PACIFIC and DICKS Sporting into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NEW PACIFIC METALS and DICKS Sporting Goods, you can compare the effects of market volatilities on NEW PACIFIC and DICKS Sporting 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 NEW PACIFIC with a short position of DICKS Sporting. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEW PACIFIC and DICKS Sporting.
Diversification Opportunities for NEW PACIFIC and DICKS Sporting
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NEW and DICKS is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding NEW PACIFIC METALS and DICKS Sporting Goods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DICKS Sporting Goods and NEW PACIFIC 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 NEW PACIFIC METALS are associated (or correlated) with DICKS Sporting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DICKS Sporting Goods has no effect on the direction of NEW PACIFIC i.e., NEW PACIFIC and DICKS Sporting go up and down completely randomly.
Pair Corralation between NEW PACIFIC and DICKS Sporting
Assuming the 90 days trading horizon NEW PACIFIC METALS is expected to under-perform the DICKS Sporting. In addition to that, NEW PACIFIC is 2.0 times more volatile than DICKS Sporting Goods. It trades about 0.0 of its total potential returns per unit of risk. DICKS Sporting Goods is currently generating about 0.06 per unit of volatility. If you would invest 18,871 in DICKS Sporting Goods on October 25, 2024 and sell it today you would earn a total of 3,404 from holding DICKS Sporting Goods or generate 18.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NEW PACIFIC METALS vs. DICKS Sporting Goods
Performance |
| Timeline |
| NEW PACIFIC METALS |
| DICKS Sporting Goods |
NEW PACIFIC and DICKS Sporting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NEW PACIFIC and DICKS Sporting
The main advantage of trading using opposite NEW PACIFIC and DICKS Sporting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEW PACIFIC position performs unexpectedly, DICKS Sporting 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 DICKS Sporting will offset losses from the drop in DICKS Sporting's long position.| NEW PACIFIC vs. Chengdu PUTIAN Telecommunications | NEW PACIFIC vs. Corporate Office Properties | NEW PACIFIC vs. CENTURIA OFFICE REIT | NEW PACIFIC vs. TELECOM ITALIA |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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