Correlation Between Hanesbrands and Counterpoint Tactical
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Counterpoint Tactical 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 Counterpoint Tactical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Counterpoint Tactical Income, you can compare the effects of market volatilities on Hanesbrands and Counterpoint Tactical 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 Counterpoint Tactical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Counterpoint Tactical.
Diversification Opportunities for Hanesbrands and Counterpoint Tactical
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hanesbrands and Counterpoint is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Counterpoint Tactical Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Counterpoint Tactical 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 Counterpoint Tactical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Counterpoint Tactical has no effect on the direction of Hanesbrands i.e., Hanesbrands and Counterpoint Tactical go up and down completely randomly.
Pair Corralation between Hanesbrands and Counterpoint Tactical
Considering the 90-day investment horizon Hanesbrands is expected to generate 33.33 times more return on investment than Counterpoint Tactical. However, Hanesbrands is 33.33 times more volatile than Counterpoint Tactical Income. It trades about 0.24 of its potential returns per unit of risk. Counterpoint Tactical Income is currently generating about 0.16 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 | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanesbrands vs. Counterpoint Tactical Income
Performance |
| Timeline |
| Hanesbrands |
| Counterpoint Tactical |
Hanesbrands and Counterpoint Tactical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Counterpoint Tactical
The main advantage of trading using opposite Hanesbrands and Counterpoint Tactical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Counterpoint Tactical 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 Counterpoint Tactical will offset losses from the drop in Counterpoint Tactical's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
| Counterpoint Tactical vs. Counterpoint Tactical Income | Counterpoint Tactical vs. Doubleline E Fixed | Counterpoint Tactical vs. Bts Tactical Fixed | Counterpoint Tactical vs. Highland Merger Arbitrage |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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