Correlation Between Duluth Holdings and Genesco
Can any of the company-specific risk be diversified away by investing in both Duluth Holdings and Genesco 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 Duluth Holdings and Genesco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Duluth Holdings and Genesco, you can compare the effects of market volatilities on Duluth Holdings and Genesco 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 Duluth Holdings with a short position of Genesco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duluth Holdings and Genesco.
Diversification Opportunities for Duluth Holdings and Genesco
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Duluth and Genesco is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Duluth Holdings and Genesco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesco and Duluth 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 Duluth Holdings are associated (or correlated) with Genesco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesco has no effect on the direction of Duluth Holdings i.e., Duluth Holdings and Genesco go up and down completely randomly.
Pair Corralation between Duluth Holdings and Genesco
Given the investment horizon of 90 days Duluth Holdings is expected to under-perform the Genesco. But the stock apears to be less risky and, when comparing its historical volatility, Duluth Holdings is 1.37 times less risky than Genesco. The stock trades about -0.04 of its potential returns per unit of risk. The Genesco is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 4,771 in Genesco on October 20, 2024 and sell it today you would lose (737.00) from holding Genesco or give up 15.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duluth Holdings vs. Genesco
Performance |
| Timeline |
| Duluth Holdings |
| Genesco |
Duluth Holdings and Genesco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duluth Holdings and Genesco
The main advantage of trading using opposite Duluth Holdings and Genesco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duluth Holdings position performs unexpectedly, Genesco 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 Genesco will offset losses from the drop in Genesco's long position.| Duluth Holdings vs. Zumiez Inc | Duluth Holdings vs. JJill Inc | Duluth Holdings vs. Shoe Carnival | Duluth Holdings vs. Cato Corporation |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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