Correlation Between Gildan Activewear and Mamas Creations
Can any of the company-specific risk be diversified away by investing in both Gildan Activewear and Mamas Creations 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 Mamas Creations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gildan Activewear and Mamas Creations, you can compare the effects of market volatilities on Gildan Activewear and Mamas Creations 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 Mamas Creations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gildan Activewear and Mamas Creations.
Diversification Opportunities for Gildan Activewear and Mamas Creations
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gildan and Mamas is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Gildan Activewear and Mamas Creations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mamas Creations 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 Mamas Creations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mamas Creations has no effect on the direction of Gildan Activewear i.e., Gildan Activewear and Mamas Creations go up and down completely randomly.
Pair Corralation between Gildan Activewear and Mamas Creations
Considering the 90-day investment horizon Gildan Activewear is expected to generate 0.32 times more return on investment than Mamas Creations. However, Gildan Activewear is 3.09 times less risky than Mamas Creations. It trades about 0.37 of its potential returns per unit of risk. Mamas Creations is currently generating about 0.06 per unit of risk. If you would invest 4,683 in Gildan Activewear on October 25, 2024 and sell it today you would earn a total of 404.00 from holding Gildan Activewear or generate 8.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gildan Activewear vs. Mamas Creations
Performance |
| Timeline |
| Gildan Activewear |
| Mamas Creations |
Gildan Activewear and Mamas Creations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gildan Activewear and Mamas Creations
The main advantage of trading using opposite Gildan Activewear and Mamas Creations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gildan Activewear position performs unexpectedly, Mamas Creations 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 Mamas Creations will offset losses from the drop in Mamas Creations' 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 |
| Mamas Creations vs. Ingredion Incorporated | Mamas Creations vs. Hanover Foods | Mamas Creations vs. BBB Foods | Mamas Creations vs. Harmony Gold Mining |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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