Correlation Between COLUMBIA SPORTSWEAR and Sporttotal
Can any of the company-specific risk be diversified away by investing in both COLUMBIA SPORTSWEAR and Sporttotal 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 Sporttotal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COLUMBIA SPORTSWEAR and Sporttotal AG, you can compare the effects of market volatilities on COLUMBIA SPORTSWEAR and Sporttotal 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 Sporttotal. Check out your portfolio center. Please also check ongoing floating volatility patterns of COLUMBIA SPORTSWEAR and Sporttotal.
Diversification Opportunities for COLUMBIA SPORTSWEAR and Sporttotal
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between COLUMBIA and Sporttotal is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding COLUMBIA SPORTSWEAR and Sporttotal AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sporttotal AG 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 Sporttotal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sporttotal AG has no effect on the direction of COLUMBIA SPORTSWEAR i.e., COLUMBIA SPORTSWEAR and Sporttotal go up and down completely randomly.
Pair Corralation between COLUMBIA SPORTSWEAR and Sporttotal
Assuming the 90 days trading horizon COLUMBIA SPORTSWEAR is expected to generate 0.21 times more return on investment than Sporttotal. However, COLUMBIA SPORTSWEAR is 4.81 times less risky than Sporttotal. It trades about -0.02 of its potential returns per unit of risk. Sporttotal AG is currently generating about -0.04 per unit of risk. If you would invest 7,169 in COLUMBIA SPORTSWEAR on January 25, 2025 and sell it today you would lose (1,469) from holding COLUMBIA SPORTSWEAR or give up 20.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COLUMBIA SPORTSWEAR vs. Sporttotal AG
Performance |
| Timeline |
| COLUMBIA SPORTSWEAR |
| Sporttotal AG |
COLUMBIA SPORTSWEAR and Sporttotal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COLUMBIA SPORTSWEAR and Sporttotal
The main advantage of trading using opposite COLUMBIA SPORTSWEAR and Sporttotal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COLUMBIA SPORTSWEAR position performs unexpectedly, Sporttotal 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 Sporttotal will offset losses from the drop in Sporttotal's long position.| COLUMBIA SPORTSWEAR vs. GRUPO CARSO A1 | COLUMBIA SPORTSWEAR vs. CONTAGIOUS GAMING INC | COLUMBIA SPORTSWEAR vs. EMPEROR ENT HOTEL | COLUMBIA SPORTSWEAR vs. DALATA HOTEL |
| Sporttotal vs. Public Storage | Sporttotal vs. DOCDATA | Sporttotal vs. INFORMATION SVC GRP | Sporttotal vs. Auto Trader Group |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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