Correlation Between Gildan Activewear and Talon International
Can any of the company-specific risk be diversified away by investing in both Gildan Activewear and Talon International 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 Talon International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gildan Activewear and Talon International, you can compare the effects of market volatilities on Gildan Activewear and Talon International 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 Talon International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gildan Activewear and Talon International.
Diversification Opportunities for Gildan Activewear and Talon International
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gildan and Talon is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Gildan Activewear and Talon International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Talon International 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 Talon International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Talon International has no effect on the direction of Gildan Activewear i.e., Gildan Activewear and Talon International go up and down completely randomly.
Pair Corralation between Gildan Activewear and Talon International
Considering the 90-day investment horizon Gildan Activewear is expected to generate 6.5 times less return on investment than Talon International. But when comparing it to its historical volatility, Gildan Activewear is 5.94 times less risky than Talon International. It trades about 0.08 of its potential returns per unit of risk. Talon International is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Talon International on September 3, 2024 and sell it today you would earn a total of 2.00 from holding Talon International or generate 15.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 7.88% |
| Values | Daily Returns |
Gildan Activewear vs. Talon International
Performance |
| Timeline |
| Gildan Activewear |
| Talon International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Gildan Activewear and Talon International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gildan Activewear and Talon International
The main advantage of trading using opposite Gildan Activewear and Talon International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gildan Activewear position performs unexpectedly, Talon International 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 Talon International will offset losses from the drop in Talon International'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 |
| Talon International vs. Table Trac | Talon International vs. Seychelle Environmtl | Talon International vs. Pacific Health Care | Talon International vs. Saker Aviation Services |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |