Correlation Between G III and WAGNERS HOLDING
Can any of the company-specific risk be diversified away by investing in both G III and WAGNERS HOLDING 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 G III and WAGNERS HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G III Apparel Group and WAGNERS HOLDING LTD, you can compare the effects of market volatilities on G III and WAGNERS HOLDING 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 G III with a short position of WAGNERS HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of G III and WAGNERS HOLDING.
Diversification Opportunities for G III and WAGNERS HOLDING
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between GI4 and WAGNERS is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding G III Apparel Group and WAGNERS HOLDING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WAGNERS HOLDING LTD and G III 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 G III Apparel Group are associated (or correlated) with WAGNERS HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WAGNERS HOLDING LTD has no effect on the direction of G III i.e., G III and WAGNERS HOLDING go up and down completely randomly.
Pair Corralation between G III and WAGNERS HOLDING
Assuming the 90 days trading horizon G III Apparel Group is expected to under-perform the WAGNERS HOLDING. But the stock apears to be less risky and, when comparing its historical volatility, G III Apparel Group is 1.65 times less risky than WAGNERS HOLDING. The stock trades about -0.14 of its potential returns per unit of risk. The WAGNERS HOLDING LTD is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 81.00 in WAGNERS HOLDING LTD on October 28, 2024 and sell it today you would earn a total of 11.00 from holding WAGNERS HOLDING LTD or generate 13.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
G III Apparel Group vs. WAGNERS HOLDING LTD
Performance |
| Timeline |
| G III Apparel |
| WAGNERS HOLDING LTD |
G III and WAGNERS HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G III and WAGNERS HOLDING
The main advantage of trading using opposite G III and WAGNERS HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G III position performs unexpectedly, WAGNERS HOLDING 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 WAGNERS HOLDING will offset losses from the drop in WAGNERS HOLDING's long position.The idea behind G III Apparel Group and WAGNERS HOLDING LTD pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| WAGNERS HOLDING vs. Nomad Foods | WAGNERS HOLDING vs. US FOODS HOLDING | WAGNERS HOLDING vs. SENECA FOODS A | WAGNERS HOLDING vs. BOSTON BEER A |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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