Correlation Between Hanesbrands and Strategic Advisers
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Strategic Advisers 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 Strategic Advisers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Strategic Advisers Fidelity, you can compare the effects of market volatilities on Hanesbrands and Strategic Advisers 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 Strategic Advisers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Strategic Advisers.
Diversification Opportunities for Hanesbrands and Strategic Advisers
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hanesbrands and Strategic is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Strategic Advisers Fidelity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Advisers 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 Strategic Advisers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Advisers has no effect on the direction of Hanesbrands i.e., Hanesbrands and Strategic Advisers go up and down completely randomly.
Pair Corralation between Hanesbrands and Strategic Advisers
Considering the 90-day investment horizon Hanesbrands is expected to generate 4.37 times more return on investment than Strategic Advisers. However, Hanesbrands is 4.37 times more volatile than Strategic Advisers Fidelity. It trades about 0.11 of its potential returns per unit of risk. Strategic Advisers Fidelity is currently generating about 0.14 per unit of risk. If you would invest 387.00 in Hanesbrands on September 4, 2024 and sell it today you would earn a total of 504.00 from holding Hanesbrands or generate 130.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Hanesbrands vs. Strategic Advisers Fidelity
Performance |
| Timeline |
| Hanesbrands |
| Strategic Advisers |
Hanesbrands and Strategic Advisers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Strategic Advisers
The main advantage of trading using opposite Hanesbrands and Strategic Advisers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Strategic Advisers 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 Strategic Advisers will offset losses from the drop in Strategic Advisers' 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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