Correlation Between Gildan Activewear and Hugo Boss
Can any of the company-specific risk be diversified away by investing in both Gildan Activewear and Hugo Boss 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 Gildan Activewear and Hugo Boss into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gildan Activewear and Hugo Boss AG, you can compare the effects of market volatilities on Gildan Activewear and Hugo Boss 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 Gildan Activewear with a short position of Hugo Boss. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gildan Activewear and Hugo Boss.
Diversification Opportunities for Gildan Activewear and Hugo Boss
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Gildan and Hugo is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Gildan Activewear and Hugo Boss AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hugo Boss AG and Gildan Activewear 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 Gildan Activewear are associated (or correlated) with Hugo Boss. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hugo Boss AG has no effect on the direction of Gildan Activewear i.e., Gildan Activewear and Hugo Boss go up and down completely randomly.
Pair Corralation between Gildan Activewear and Hugo Boss
Considering the 90-day investment horizon Gildan Activewear is expected to generate 16.21 times less return on investment than Hugo Boss. But when comparing it to its historical volatility, Gildan Activewear is 5.19 times less risky than Hugo Boss. It trades about 0.02 of its potential returns per unit of risk. Hugo Boss AG is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 828.00 in Hugo Boss AG on September 13, 2024 and sell it today you would earn a total of 30.00 from holding Hugo Boss AG or generate 3.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gildan Activewear vs. Hugo Boss AG
Performance |
| Timeline |
| Gildan Activewear |
| Hugo Boss AG |
Gildan Activewear and Hugo Boss Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gildan Activewear and Hugo Boss
The main advantage of trading using opposite Gildan Activewear and Hugo Boss positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gildan Activewear position performs unexpectedly, Hugo Boss 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 Hugo Boss will offset losses from the drop in Hugo Boss' long position.| Gildan Activewear vs. Digital Brands Group | Gildan Activewear vs. Data Storage | Gildan Activewear vs. Auddia Inc | Gildan Activewear vs. DatChat Series A |
| Hugo Boss vs. VF Corporation | Hugo Boss vs. Levi Strauss Co | Hugo Boss vs. Under Armour C | Hugo Boss vs. Under Armour 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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