Correlation Between G-III Apparel and Pick N
Can any of the company-specific risk be diversified away by investing in both G-III Apparel and Pick N 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 Apparel and Pick N 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 Pick n Pay, you can compare the effects of market volatilities on G-III Apparel and Pick N 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 Apparel with a short position of Pick N. Check out your portfolio center. Please also check ongoing floating volatility patterns of G-III Apparel and Pick N.
Diversification Opportunities for G-III Apparel and Pick N
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between G-III and Pick is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding G III Apparel Group and Pick n Pay in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pick n Pay and G-III Apparel 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 Pick N. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pick n Pay has no effect on the direction of G-III Apparel i.e., G-III Apparel and Pick N go up and down completely randomly.
Pair Corralation between G-III Apparel and Pick N
Assuming the 90 days trading horizon G III Apparel Group is expected to generate 2.24 times more return on investment than Pick N. However, G-III Apparel is 2.24 times more volatile than Pick n Pay. It trades about 0.13 of its potential returns per unit of risk. Pick n Pay is currently generating about 0.01 per unit of risk. If you would invest 2,920 in G III Apparel Group on October 7, 2024 and sell it today you would earn a total of 200.00 from holding G III Apparel Group or generate 6.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
G III Apparel Group vs. Pick n Pay
Performance |
| Timeline |
| G III Apparel |
| Pick n Pay |
G-III Apparel and Pick N Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G-III Apparel and Pick N
The main advantage of trading using opposite G-III Apparel and Pick N positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G-III Apparel position performs unexpectedly, Pick N 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 Pick N will offset losses from the drop in Pick N's long position.| G-III Apparel vs. Apple Inc | G-III Apparel vs. Apple Inc | G-III Apparel vs. Apple Inc | G-III Apparel vs. Apple Inc |
| Pick N vs. SCANDMEDICAL SOLDK 040 | Pick N vs. Inspire Medical Systems | Pick N vs. ENVVENO MEDICAL DL 00001 | Pick N vs. Compugroup Medical SE |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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