Correlation Between Estee Lauder and Glacier Bancorp
Can any of the company-specific risk be diversified away by investing in both Estee Lauder and Glacier Bancorp 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 Estee Lauder and Glacier Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Estee Lauder Companies and Glacier Bancorp, you can compare the effects of market volatilities on Estee Lauder and Glacier Bancorp 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 Estee Lauder with a short position of Glacier Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Estee Lauder and Glacier Bancorp.
Diversification Opportunities for Estee Lauder and Glacier Bancorp
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Estee and Glacier is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Estee Lauder Companies and Glacier Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glacier Bancorp and Estee Lauder 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 Estee Lauder Companies are associated (or correlated) with Glacier Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glacier Bancorp has no effect on the direction of Estee Lauder i.e., Estee Lauder and Glacier Bancorp go up and down completely randomly.
Pair Corralation between Estee Lauder and Glacier Bancorp
Allowing for the 90-day total investment horizon Estee Lauder Companies is expected to under-perform the Glacier Bancorp. In addition to that, Estee Lauder is 1.81 times more volatile than Glacier Bancorp. It trades about -0.12 of its total potential returns per unit of risk. Glacier Bancorp is currently generating about 0.16 per unit of volatility. If you would invest 5,332 in Glacier Bancorp on August 31, 2024 and sell it today you would earn a total of 510.00 from holding Glacier Bancorp or generate 9.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Estee Lauder Companies vs. Glacier Bancorp
Performance |
| Timeline |
| Estee Lauder Companies |
| Glacier Bancorp |
Estee Lauder and Glacier Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Estee Lauder and Glacier Bancorp
The main advantage of trading using opposite Estee Lauder and Glacier Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Estee Lauder position performs unexpectedly, Glacier Bancorp 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 Glacier Bancorp will offset losses from the drop in Glacier Bancorp's long position.| Estee Lauder vs. Honest Company | Estee Lauder vs. Hims Hers Health | Estee Lauder vs. Procter Gamble | Estee Lauder vs. Coty Inc |
| Glacier Bancorp vs. CVB Financial | Glacier Bancorp vs. Independent Bank Group | Glacier Bancorp vs. Columbia Banking System | Glacier Bancorp vs. First Financial Bankshares |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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