Correlation Between COLUMBIA SPORTSWEAR and FEMALE HEALTH
Can any of the company-specific risk be diversified away by investing in both COLUMBIA SPORTSWEAR and FEMALE HEALTH 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 COLUMBIA SPORTSWEAR and FEMALE HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COLUMBIA SPORTSWEAR and FEMALE HEALTH, you can compare the effects of market volatilities on COLUMBIA SPORTSWEAR and FEMALE HEALTH 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 COLUMBIA SPORTSWEAR with a short position of FEMALE HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of COLUMBIA SPORTSWEAR and FEMALE HEALTH.
Diversification Opportunities for COLUMBIA SPORTSWEAR and FEMALE HEALTH
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between COLUMBIA and FEMALE is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding COLUMBIA SPORTSWEAR and FEMALE HEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FEMALE HEALTH and COLUMBIA SPORTSWEAR 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 COLUMBIA SPORTSWEAR are associated (or correlated) with FEMALE HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FEMALE HEALTH has no effect on the direction of COLUMBIA SPORTSWEAR i.e., COLUMBIA SPORTSWEAR and FEMALE HEALTH go up and down completely randomly.
Pair Corralation between COLUMBIA SPORTSWEAR and FEMALE HEALTH
Assuming the 90 days trading horizon COLUMBIA SPORTSWEAR is expected to generate 0.23 times more return on investment than FEMALE HEALTH. However, COLUMBIA SPORTSWEAR is 4.32 times less risky than FEMALE HEALTH. It trades about 0.01 of its potential returns per unit of risk. FEMALE HEALTH is currently generating about -0.04 per unit of risk. If you would invest 7,940 in COLUMBIA SPORTSWEAR on October 13, 2024 and sell it today you would earn a total of 60.00 from holding COLUMBIA SPORTSWEAR or generate 0.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COLUMBIA SPORTSWEAR vs. FEMALE HEALTH
Performance |
| Timeline |
| COLUMBIA SPORTSWEAR |
| FEMALE HEALTH |
COLUMBIA SPORTSWEAR and FEMALE HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COLUMBIA SPORTSWEAR and FEMALE HEALTH
The main advantage of trading using opposite COLUMBIA SPORTSWEAR and FEMALE HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COLUMBIA SPORTSWEAR position performs unexpectedly, FEMALE HEALTH 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 FEMALE HEALTH will offset losses from the drop in FEMALE HEALTH's long position.| COLUMBIA SPORTSWEAR vs. Cardinal Health | COLUMBIA SPORTSWEAR vs. OPKO HEALTH | COLUMBIA SPORTSWEAR vs. CLOVER HEALTH INV | COLUMBIA SPORTSWEAR vs. PURETECH HEALTH PLC |
| FEMALE HEALTH vs. JD SPORTS FASH | FEMALE HEALTH vs. MCEWEN MINING INC | FEMALE HEALTH vs. Yanzhou Coal Mining | FEMALE HEALTH vs. COLUMBIA SPORTSWEAR |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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