Correlation Between Abercrombie Fitch and Grounded People
Can any of the company-specific risk be diversified away by investing in both Abercrombie Fitch and Grounded People 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 Abercrombie Fitch and Grounded People into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Abercrombie Fitch and Grounded People Apparel, you can compare the effects of market volatilities on Abercrombie Fitch and Grounded People 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 Abercrombie Fitch with a short position of Grounded People. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abercrombie Fitch and Grounded People.
Diversification Opportunities for Abercrombie Fitch and Grounded People
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Abercrombie and Grounded is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Abercrombie Fitch and Grounded People Apparel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grounded People Apparel and Abercrombie Fitch 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 Abercrombie Fitch are associated (or correlated) with Grounded People. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grounded People Apparel has no effect on the direction of Abercrombie Fitch i.e., Abercrombie Fitch and Grounded People go up and down completely randomly.
Pair Corralation between Abercrombie Fitch and Grounded People
Considering the 90-day investment horizon Abercrombie Fitch is expected to generate 0.67 times more return on investment than Grounded People. However, Abercrombie Fitch is 1.5 times less risky than Grounded People. It trades about 0.1 of its potential returns per unit of risk. Grounded People Apparel is currently generating about 0.03 per unit of risk. If you would invest 3,051 in Abercrombie Fitch on October 27, 2024 and sell it today you would earn a total of 9,291 from holding Abercrombie Fitch or generate 304.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Abercrombie Fitch vs. Grounded People Apparel
Performance |
| Timeline |
| Abercrombie Fitch |
| Grounded People Apparel |
Abercrombie Fitch and Grounded People Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abercrombie Fitch and Grounded People
The main advantage of trading using opposite Abercrombie Fitch and Grounded People positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abercrombie Fitch position performs unexpectedly, Grounded People 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 Grounded People will offset losses from the drop in Grounded People's long position.| Abercrombie Fitch vs. Urban Outfitters | Abercrombie Fitch vs. Foot Locker | Abercrombie Fitch vs. Childrens Place | Abercrombie Fitch vs. American Eagle Outfitters |
| Grounded People vs. Verra Mobility Corp | Grounded People vs. Deluxe | Grounded People vs. Saia Inc | Grounded People vs. Lindblad Expeditions Holdings |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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