Correlation Between Designer Brands and JD SPORTS
Can any of the company-specific risk be diversified away by investing in both Designer Brands and JD SPORTS 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 Designer Brands and JD SPORTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Designer Brands and JD SPORTS FASH, you can compare the effects of market volatilities on Designer Brands and JD SPORTS 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 Designer Brands with a short position of JD SPORTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Designer Brands and JD SPORTS.
Diversification Opportunities for Designer Brands and JD SPORTS
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Designer and 9JD is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Designer Brands and JD SPORTS FASH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD SPORTS FASH and Designer Brands 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 Designer Brands are associated (or correlated) with JD SPORTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD SPORTS FASH has no effect on the direction of Designer Brands i.e., Designer Brands and JD SPORTS go up and down completely randomly.
Pair Corralation between Designer Brands and JD SPORTS
If you would invest (100.00) in Designer Brands on August 30, 2024 and sell it today you would earn a total of 100.00 from holding Designer Brands or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Designer Brands vs. JD SPORTS FASH
Performance |
| Timeline |
| Designer Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| JD SPORTS FASH |
Designer Brands and JD SPORTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Designer Brands and JD SPORTS
The main advantage of trading using opposite Designer Brands and JD SPORTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Designer Brands position performs unexpectedly, JD SPORTS 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 JD SPORTS will offset losses from the drop in JD SPORTS's long position.| Designer Brands vs. Nishi Nippon Railroad Co | Designer Brands vs. Transport International Holdings | Designer Brands vs. Air Transport Services | Designer Brands vs. EIDESVIK OFFSHORE NK |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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