Correlation Between Academy Sports and Cable One
Can any of the company-specific risk be diversified away by investing in both Academy Sports and Cable One 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 Academy Sports and Cable One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Academy Sports and and Cable One, you can compare the effects of market volatilities on Academy Sports and Cable One 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 Academy Sports with a short position of Cable One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Academy Sports and Cable One.
Diversification Opportunities for Academy Sports and Cable One
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Academy and Cable is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Academy Sports and and Cable One in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cable One and Academy Sports 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 Academy Sports and are associated (or correlated) with Cable One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cable One has no effect on the direction of Academy Sports i.e., Academy Sports and Cable One go up and down completely randomly.
Pair Corralation between Academy Sports and Cable One
Assuming the 90 days trading horizon Academy Sports and is expected to generate 0.8 times more return on investment than Cable One. However, Academy Sports and is 1.24 times less risky than Cable One. It trades about 0.02 of its potential returns per unit of risk. Cable One is currently generating about -0.06 per unit of risk. If you would invest 7,718 in Academy Sports and on November 7, 2024 and sell it today you would earn a total of 674.00 from holding Academy Sports and or generate 8.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 68.37% |
| Values | Daily Returns |
Academy Sports and vs. Cable One
Performance |
| Timeline |
| Academy Sports |
| Cable One |
Academy Sports and Cable One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Academy Sports and Cable One
The main advantage of trading using opposite Academy Sports and Cable One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Academy Sports position performs unexpectedly, Cable One 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 Cable One will offset losses from the drop in Cable One's long position.| Academy Sports vs. Taiwan Semiconductor Manufacturing | Academy Sports vs. Apple Inc | Academy Sports vs. Alibaba Group Holding | Academy Sports vs. Microsoft |
| Cable One vs. Ross Stores | Cable One vs. Applied Materials, | Cable One vs. Liberty Broadband | Cable One vs. Universal Health Services, |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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