Correlation Between Duluth Holdings and Nike
Can any of the company-specific risk be diversified away by investing in both Duluth Holdings and Nike 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 Nike into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Duluth Holdings and Nike Inc, you can compare the effects of market volatilities on Duluth Holdings and Nike 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 Nike. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duluth Holdings and Nike.
Diversification Opportunities for Duluth Holdings and Nike
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Duluth and Nike is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Duluth Holdings and Nike Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nike Inc 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 Nike. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nike Inc has no effect on the direction of Duluth Holdings i.e., Duluth Holdings and Nike go up and down completely randomly.
Pair Corralation between Duluth Holdings and Nike
Given the investment horizon of 90 days Duluth Holdings is expected to generate 1.36 times more return on investment than Nike. However, Duluth Holdings is 1.36 times more volatile than Nike Inc. It trades about -0.03 of its potential returns per unit of risk. Nike Inc is currently generating about -0.04 per unit of risk. If you would invest 501.00 in Duluth Holdings on August 29, 2024 and sell it today you would lose (112.00) from holding Duluth Holdings or give up 22.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duluth Holdings vs. Nike Inc
Performance |
| Timeline |
| Duluth Holdings |
| Nike Inc |
Duluth Holdings and Nike Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duluth Holdings and Nike
The main advantage of trading using opposite Duluth Holdings and Nike positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duluth Holdings position performs unexpectedly, Nike 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 Nike will offset losses from the drop in Nike'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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |