Correlation Between Burnham Holdings and Steven Madden
Can any of the company-specific risk be diversified away by investing in both Burnham Holdings and Steven Madden 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 Burnham Holdings and Steven Madden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burnham Holdings PFD and Steven Madden, you can compare the effects of market volatilities on Burnham Holdings and Steven Madden 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 Burnham Holdings with a short position of Steven Madden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burnham Holdings and Steven Madden.
Diversification Opportunities for Burnham Holdings and Steven Madden
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Burnham and Steven is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Burnham Holdings PFD and Steven Madden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Steven Madden and Burnham Holdings 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 Burnham Holdings PFD are associated (or correlated) with Steven Madden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Steven Madden has no effect on the direction of Burnham Holdings i.e., Burnham Holdings and Steven Madden go up and down completely randomly.
Pair Corralation between Burnham Holdings and Steven Madden
Assuming the 90 days horizon Burnham Holdings is expected to generate 4.75 times less return on investment than Steven Madden. But when comparing it to its historical volatility, Burnham Holdings PFD is 7.89 times less risky than Steven Madden. It trades about 0.08 of its potential returns per unit of risk. Steven Madden is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,110 in Steven Madden on September 12, 2024 and sell it today you would earn a total of 1,242 from holding Steven Madden or generate 39.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Burnham Holdings PFD vs. Steven Madden
Performance |
| Timeline |
| Burnham Holdings PFD |
| Steven Madden |
Burnham Holdings and Steven Madden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burnham Holdings and Steven Madden
The main advantage of trading using opposite Burnham Holdings and Steven Madden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burnham Holdings position performs unexpectedly, Steven Madden 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 Steven Madden will offset losses from the drop in Steven Madden's long position.| Burnham Holdings vs. Yum Brands | Burnham Holdings vs. Cannae Holdings | Burnham Holdings vs. Chipotle Mexican Grill | Burnham Holdings vs. First Watch Restaurant |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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