Correlation Between Hanesbrands and ADS Maritime
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and ADS Maritime 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 ADS Maritime into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and ADS Maritime Holding, you can compare the effects of market volatilities on Hanesbrands and ADS Maritime 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 ADS Maritime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and ADS Maritime.
Diversification Opportunities for Hanesbrands and ADS Maritime
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hanesbrands and ADS is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and ADS Maritime Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADS Maritime Holding 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 ADS Maritime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADS Maritime Holding has no effect on the direction of Hanesbrands i.e., Hanesbrands and ADS Maritime go up and down completely randomly.
Pair Corralation between Hanesbrands and ADS Maritime
Considering the 90-day investment horizon Hanesbrands is expected to generate 1.38 times more return on investment than ADS Maritime. However, Hanesbrands is 1.38 times more volatile than ADS Maritime Holding. It trades about 0.04 of its potential returns per unit of risk. ADS Maritime Holding is currently generating about 0.01 per unit of risk. If you would invest 592.00 in Hanesbrands on September 12, 2024 and sell it today you would earn a total of 249.00 from holding Hanesbrands or generate 42.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Hanesbrands vs. ADS Maritime Holding
Performance |
| Timeline |
| Hanesbrands |
| ADS Maritime Holding |
Hanesbrands and ADS Maritime Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and ADS Maritime
The main advantage of trading using opposite Hanesbrands and ADS Maritime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, ADS Maritime 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 ADS Maritime will offset losses from the drop in ADS Maritime's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
| ADS Maritime vs. Havila Shipping ASA | ADS Maritime vs. Shelf Drilling | ADS Maritime vs. Solstad Offsho | ADS Maritime vs. Eidesvik Offshore ASA |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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