Correlation Between Academy Sports and TFI International
Can any of the company-specific risk be diversified away by investing in both Academy Sports and TFI International 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 TFI International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Academy Sports Outdoors and TFI International, you can compare the effects of market volatilities on Academy Sports and TFI International 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 TFI International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Academy Sports and TFI International.
Diversification Opportunities for Academy Sports and TFI International
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Academy and TFI is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Academy Sports Outdoors and TFI International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TFI International 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 Outdoors are associated (or correlated) with TFI International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TFI International has no effect on the direction of Academy Sports i.e., Academy Sports and TFI International go up and down completely randomly.
Pair Corralation between Academy Sports and TFI International
Considering the 90-day investment horizon Academy Sports Outdoors is expected to under-perform the TFI International. In addition to that, Academy Sports is 1.7 times more volatile than TFI International. It trades about -0.15 of its total potential returns per unit of risk. TFI International is currently generating about -0.04 per unit of volatility. If you would invest 13,364 in TFI International on November 4, 2024 and sell it today you would lose (183.00) from holding TFI International or give up 1.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Academy Sports Outdoors vs. TFI International
Performance |
| Timeline |
| Academy Sports Outdoors |
| TFI International |
Academy Sports and TFI International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Academy Sports and TFI International
The main advantage of trading using opposite Academy Sports and TFI International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Academy Sports position performs unexpectedly, TFI International 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 TFI International will offset losses from the drop in TFI International's long position.| Academy Sports vs. Williams Sonoma | Academy Sports vs. AutoZone | Academy Sports vs. Ulta Beauty | Academy Sports vs. Best Buy Co |
| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Marten Transport | TFI International vs. Werner Enterprises |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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