Correlation Between DICKS Sporting and NEW PACIFIC
Can any of the company-specific risk be diversified away by investing in both DICKS Sporting and NEW PACIFIC 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 DICKS Sporting and NEW PACIFIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DICKS Sporting Goods and NEW PACIFIC METALS, you can compare the effects of market volatilities on DICKS Sporting and NEW PACIFIC 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 DICKS Sporting with a short position of NEW PACIFIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of DICKS Sporting and NEW PACIFIC.
Diversification Opportunities for DICKS Sporting and NEW PACIFIC
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between DICKS and NEW is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding DICKS Sporting Goods and NEW PACIFIC METALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEW PACIFIC METALS and DICKS Sporting 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 DICKS Sporting Goods are associated (or correlated) with NEW PACIFIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEW PACIFIC METALS has no effect on the direction of DICKS Sporting i.e., DICKS Sporting and NEW PACIFIC go up and down completely randomly.
Pair Corralation between DICKS Sporting and NEW PACIFIC
Assuming the 90 days horizon DICKS Sporting Goods is expected to generate 0.5 times more return on investment than NEW PACIFIC. However, DICKS Sporting Goods is 2.0 times less risky than NEW PACIFIC. It trades about 0.06 of its potential returns per unit of risk. NEW PACIFIC METALS is currently generating about 0.0 per unit of risk. If you would invest 18,871 in DICKS Sporting Goods on October 25, 2024 and sell it today you would earn a total of 3,404 from holding DICKS Sporting Goods or generate 18.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DICKS Sporting Goods vs. NEW PACIFIC METALS
Performance |
| Timeline |
| DICKS Sporting Goods |
| NEW PACIFIC METALS |
DICKS Sporting and NEW PACIFIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DICKS Sporting and NEW PACIFIC
The main advantage of trading using opposite DICKS Sporting and NEW PACIFIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DICKS Sporting position performs unexpectedly, NEW PACIFIC 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 NEW PACIFIC will offset losses from the drop in NEW PACIFIC's long position.| DICKS Sporting vs. Playa Hotels Resorts | DICKS Sporting vs. REVO INSURANCE SPA | DICKS Sporting vs. UNIQA INSURANCE GR | DICKS Sporting vs. LG Display Co |
| NEW PACIFIC vs. Chengdu PUTIAN Telecommunications | NEW PACIFIC vs. Corporate Office Properties | NEW PACIFIC vs. CENTURIA OFFICE REIT | NEW PACIFIC vs. TELECOM ITALIA |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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