Correlation Between MYFAIR GOLD and G-III APPAREL
Can any of the company-specific risk be diversified away by investing in both MYFAIR GOLD and G-III APPAREL 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 MYFAIR GOLD and G-III APPAREL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MYFAIR GOLD P and G III APPAREL GROUP, you can compare the effects of market volatilities on MYFAIR GOLD and G-III APPAREL 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 MYFAIR GOLD with a short position of G-III APPAREL. Check out your portfolio center. Please also check ongoing floating volatility patterns of MYFAIR GOLD and G-III APPAREL.
Diversification Opportunities for MYFAIR GOLD and G-III APPAREL
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MYFAIR and G-III is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding MYFAIR GOLD P and G III APPAREL GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G III APPAREL and MYFAIR GOLD 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 MYFAIR GOLD P are associated (or correlated) with G-III APPAREL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G III APPAREL has no effect on the direction of MYFAIR GOLD i.e., MYFAIR GOLD and G-III APPAREL go up and down completely randomly.
Pair Corralation between MYFAIR GOLD and G-III APPAREL
Assuming the 90 days horizon MYFAIR GOLD is expected to generate 2.88 times less return on investment than G-III APPAREL. But when comparing it to its historical volatility, MYFAIR GOLD P is 1.07 times less risky than G-III APPAREL. It trades about 0.02 of its potential returns per unit of risk. G III APPAREL GROUP is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,510 in G III APPAREL GROUP on November 7, 2024 and sell it today you would earn a total of 1,330 from holding G III APPAREL GROUP or generate 88.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MYFAIR GOLD P vs. G III APPAREL GROUP
Performance |
| Timeline |
| MYFAIR GOLD P |
| G III APPAREL |
MYFAIR GOLD and G-III APPAREL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MYFAIR GOLD and G-III APPAREL
The main advantage of trading using opposite MYFAIR GOLD and G-III APPAREL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MYFAIR GOLD position performs unexpectedly, G-III APPAREL 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 G-III APPAREL will offset losses from the drop in G-III APPAREL's long position.| MYFAIR GOLD vs. ZIJIN MINH UNSPADR20 | MYFAIR GOLD vs. Newmont | MYFAIR GOLD vs. Barrick Gold | MYFAIR GOLD vs. Franco Nevada |
| G-III APPAREL vs. NAKED WINES PLC | G-III APPAREL vs. OFFICE DEPOT | G-III APPAREL vs. Corporate Office Properties | G-III APPAREL vs. DFS Furniture PLC |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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