Correlation Between Hanesbrands and Awea Mechantronic
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Awea Mechantronic 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 Hanesbrands and Awea Mechantronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Awea Mechantronic Co, you can compare the effects of market volatilities on Hanesbrands and Awea Mechantronic 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 Hanesbrands with a short position of Awea Mechantronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Awea Mechantronic.
Diversification Opportunities for Hanesbrands and Awea Mechantronic
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hanesbrands and Awea is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Awea Mechantronic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Awea Mechantronic and Hanesbrands 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 Hanesbrands are associated (or correlated) with Awea Mechantronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Awea Mechantronic has no effect on the direction of Hanesbrands i.e., Hanesbrands and Awea Mechantronic go up and down completely randomly.
Pair Corralation between Hanesbrands and Awea Mechantronic
Considering the 90-day investment horizon Hanesbrands is expected to generate 2.89 times more return on investment than Awea Mechantronic. However, Hanesbrands is 2.89 times more volatile than Awea Mechantronic Co. It trades about 0.02 of its potential returns per unit of risk. Awea Mechantronic Co is currently generating about 0.01 per unit of risk. If you would invest 812.00 in Hanesbrands on September 4, 2024 and sell it today you would earn a total of 79.00 from holding Hanesbrands or generate 9.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.42% |
| Values | Daily Returns |
Hanesbrands vs. Awea Mechantronic Co
Performance |
| Timeline |
| Hanesbrands |
| Awea Mechantronic |
Hanesbrands and Awea Mechantronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Awea Mechantronic
The main advantage of trading using opposite Hanesbrands and Awea Mechantronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Awea Mechantronic 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 Awea Mechantronic will offset losses from the drop in Awea Mechantronic's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
| Awea Mechantronic vs. Universal Microelectronics Co | Awea Mechantronic vs. AVerMedia Technologies | Awea Mechantronic vs. Symtek Automation Asia | Awea Mechantronic vs. WiseChip Semiconductor |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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