Correlation Between Gildan Activewear and Charles Colvard
Can any of the company-specific risk be diversified away by investing in both Gildan Activewear and Charles Colvard 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 Charles Colvard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gildan Activewear and Charles Colvard, you can compare the effects of market volatilities on Gildan Activewear and Charles Colvard 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 Charles Colvard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gildan Activewear and Charles Colvard.
Diversification Opportunities for Gildan Activewear and Charles Colvard
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gildan and Charles is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Gildan Activewear and Charles Colvard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charles Colvard 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 Charles Colvard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charles Colvard has no effect on the direction of Gildan Activewear i.e., Gildan Activewear and Charles Colvard go up and down completely randomly.
Pair Corralation between Gildan Activewear and Charles Colvard
Considering the 90-day investment horizon Gildan Activewear is expected to generate 0.29 times more return on investment than Charles Colvard. However, Gildan Activewear is 3.39 times less risky than Charles Colvard. It trades about 0.19 of its potential returns per unit of risk. Charles Colvard is currently generating about 0.05 per unit of risk. If you would invest 4,819 in Gildan Activewear on August 28, 2024 and sell it today you would earn a total of 181.00 from holding Gildan Activewear or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gildan Activewear vs. Charles Colvard
Performance |
| Timeline |
| Gildan Activewear |
| Charles Colvard |
Gildan Activewear and Charles Colvard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gildan Activewear and Charles Colvard
The main advantage of trading using opposite Gildan Activewear and Charles Colvard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gildan Activewear position performs unexpectedly, Charles Colvard 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 Charles Colvard will offset losses from the drop in Charles Colvard's long position.| Gildan Activewear vs. Vince Holding Corp | Gildan Activewear vs. Ermenegildo Zegna NV | Gildan Activewear vs. Columbia Sportswear | Gildan Activewear vs. G III Apparel Group |
| Charles Colvard vs. Lanvin Group Holdings | Charles Colvard vs. MYT Netherlands Parent | Charles Colvard vs. Movado Group | Charles Colvard vs. Birks Group |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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