Correlation Between ANTA SPORTS and American Eagle
Can any of the company-specific risk be diversified away by investing in both ANTA SPORTS and American Eagle 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 ANTA SPORTS and American Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANTA SPORTS PRODUCT and American Eagle Outfitters, you can compare the effects of market volatilities on ANTA SPORTS and American Eagle 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 ANTA SPORTS with a short position of American Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANTA SPORTS and American Eagle.
Diversification Opportunities for ANTA SPORTS and American Eagle
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ANTA and American is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding ANTA SPORTS PRODUCT and American Eagle Outfitters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Eagle Outfitters and ANTA 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 ANTA SPORTS PRODUCT are associated (or correlated) with American Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Eagle Outfitters has no effect on the direction of ANTA SPORTS i.e., ANTA SPORTS and American Eagle go up and down completely randomly.
Pair Corralation between ANTA SPORTS and American Eagle
Assuming the 90 days trading horizon ANTA SPORTS PRODUCT is expected to under-perform the American Eagle. In addition to that, ANTA SPORTS is 1.05 times more volatile than American Eagle Outfitters. It trades about -0.17 of its total potential returns per unit of risk. American Eagle Outfitters is currently generating about -0.1 per unit of volatility. If you would invest 1,840 in American Eagle Outfitters on August 31, 2024 and sell it today you would lose (90.00) from holding American Eagle Outfitters or give up 4.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANTA SPORTS PRODUCT vs. American Eagle Outfitters
Performance |
| Timeline |
| ANTA SPORTS PRODUCT |
| American Eagle Outfitters |
ANTA SPORTS and American Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANTA SPORTS and American Eagle
The main advantage of trading using opposite ANTA SPORTS and American Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANTA SPORTS position performs unexpectedly, American Eagle 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 American Eagle will offset losses from the drop in American Eagle's long position.| ANTA SPORTS vs. SIVERS SEMICONDUCTORS AB | ANTA SPORTS vs. Darden Restaurants | ANTA SPORTS vs. Reliance Steel Aluminum | ANTA SPORTS vs. Q2M Managementberatung AG |
| American Eagle vs. Apple Inc | American Eagle vs. Apple Inc | American Eagle vs. Apple Inc | American Eagle vs. Apple Inc |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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