Correlation Between Dillards and Guess
Can any of the company-specific risk be diversified away by investing in both Dillards and Guess 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 Dillards and Guess into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dillards and Guess Inc, you can compare the effects of market volatilities on Dillards and Guess 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 Dillards with a short position of Guess. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dillards and Guess.
Diversification Opportunities for Dillards and Guess
Pay attention - limited upside
The 3 months correlation between Dillards and Guess is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Dillards and Guess Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guess Inc and Dillards 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 Dillards are associated (or correlated) with Guess. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guess Inc has no effect on the direction of Dillards i.e., Dillards and Guess go up and down completely randomly.
Pair Corralation between Dillards and Guess
Considering the 90-day investment horizon Dillards is expected to generate 0.97 times more return on investment than Guess. However, Dillards is 1.03 times less risky than Guess. It trades about 0.05 of its potential returns per unit of risk. Guess Inc is currently generating about -0.06 per unit of risk. If you would invest 36,121 in Dillards on November 9, 2024 and sell it today you would earn a total of 11,103 from holding Dillards or generate 30.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dillards vs. Guess Inc
Performance |
| Timeline |
| Dillards |
| Guess Inc |
Dillards and Guess Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dillards and Guess
The main advantage of trading using opposite Dillards and Guess positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dillards position performs unexpectedly, Guess 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 Guess will offset losses from the drop in Guess' long position.| Dillards vs. Macys Inc | Dillards vs. Kohls Corp | Dillards vs. Marks Spencer Group | Dillards vs. Marks and Spencer |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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