Correlation Between Hanesbrands and Xilinmen Furniture
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By analyzing existing cross correlation between Hanesbrands and Xilinmen Furniture Co, you can compare the effects of market volatilities on Hanesbrands and Xilinmen Furniture 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 Xilinmen Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Xilinmen Furniture.
Diversification Opportunities for Hanesbrands and Xilinmen Furniture
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hanesbrands and Xilinmen is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Xilinmen Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xilinmen Furniture 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 Xilinmen Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xilinmen Furniture has no effect on the direction of Hanesbrands i.e., Hanesbrands and Xilinmen Furniture go up and down completely randomly.
Pair Corralation between Hanesbrands and Xilinmen Furniture
Considering the 90-day investment horizon Hanesbrands is expected to generate 1.85 times more return on investment than Xilinmen Furniture. However, Hanesbrands is 1.85 times more volatile than Xilinmen Furniture Co. It trades about 0.24 of its potential returns per unit of risk. Xilinmen Furniture Co is currently generating about -0.06 per unit of risk. If you would invest 712.00 in Hanesbrands on September 3, 2024 and sell it today you would earn a total of 158.00 from holding Hanesbrands or generate 22.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Hanesbrands vs. Xilinmen Furniture Co
Performance |
| Timeline |
| Hanesbrands |
| Xilinmen Furniture |
Hanesbrands and Xilinmen Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Xilinmen Furniture
The main advantage of trading using opposite Hanesbrands and Xilinmen Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Xilinmen Furniture 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 Xilinmen Furniture will offset losses from the drop in Xilinmen Furniture's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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