Correlation Between Hanesbrands and NKSJ HOLDINGS
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and NKSJ HOLDINGS 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 NKSJ HOLDINGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and NKSJ HOLDINGS, you can compare the effects of market volatilities on Hanesbrands and NKSJ HOLDINGS 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 NKSJ HOLDINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and NKSJ HOLDINGS.
Diversification Opportunities for Hanesbrands and NKSJ HOLDINGS
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hanesbrands and NKSJ is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and NKSJ HOLDINGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NKSJ HOLDINGS 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 NKSJ HOLDINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NKSJ HOLDINGS has no effect on the direction of Hanesbrands i.e., Hanesbrands and NKSJ HOLDINGS go up and down completely randomly.
Pair Corralation between Hanesbrands and NKSJ HOLDINGS
Considering the 90-day investment horizon Hanesbrands is expected to generate 1.14 times less return on investment than NKSJ HOLDINGS. In addition to that, Hanesbrands is 1.24 times more volatile than NKSJ HOLDINGS. It trades about 0.26 of its total potential returns per unit of risk. NKSJ HOLDINGS is currently generating about 0.37 per unit of volatility. If you would invest 1,980 in NKSJ HOLDINGS on September 4, 2024 and sell it today you would earn a total of 600.00 from holding NKSJ HOLDINGS or generate 30.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanesbrands vs. NKSJ HOLDINGS
Performance |
| Timeline |
| Hanesbrands |
| NKSJ HOLDINGS |
Hanesbrands and NKSJ HOLDINGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and NKSJ HOLDINGS
The main advantage of trading using opposite Hanesbrands and NKSJ HOLDINGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, NKSJ HOLDINGS 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 NKSJ HOLDINGS will offset losses from the drop in NKSJ HOLDINGS's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
| NKSJ HOLDINGS vs. ANGLER GAMING PLC | NKSJ HOLDINGS vs. Media and Games | NKSJ HOLDINGS vs. Computershare Limited | NKSJ HOLDINGS vs. GAMESTOP |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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