Correlation Between Hanesbrands and FLYHT Aerospace
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and FLYHT Aerospace 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 FLYHT Aerospace into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and FLYHT Aerospace Solutions, you can compare the effects of market volatilities on Hanesbrands and FLYHT Aerospace 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 FLYHT Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and FLYHT Aerospace.
Diversification Opportunities for Hanesbrands and FLYHT Aerospace
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hanesbrands and FLYHT is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and FLYHT Aerospace Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FLYHT Aerospace Solutions 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 FLYHT Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FLYHT Aerospace Solutions has no effect on the direction of Hanesbrands i.e., Hanesbrands and FLYHT Aerospace go up and down completely randomly.
Pair Corralation between Hanesbrands and FLYHT Aerospace
Considering the 90-day investment horizon Hanesbrands is expected to generate 2.65 times more return on investment than FLYHT Aerospace. However, Hanesbrands is 2.65 times more volatile than FLYHT Aerospace Solutions. It trades about 0.26 of its potential returns per unit of risk. FLYHT Aerospace Solutions is currently generating about 0.09 per unit of risk. If you would invest 712.00 in Hanesbrands on September 4, 2024 and sell it today you would earn a total of 179.00 from holding Hanesbrands or generate 25.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Hanesbrands vs. FLYHT Aerospace Solutions
Performance |
| Timeline |
| Hanesbrands |
| FLYHT Aerospace Solutions |
Hanesbrands and FLYHT Aerospace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and FLYHT Aerospace
The main advantage of trading using opposite Hanesbrands and FLYHT Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, FLYHT Aerospace 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 FLYHT Aerospace will offset losses from the drop in FLYHT Aerospace's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
| FLYHT Aerospace vs. Firan Technology Group | FLYHT Aerospace vs. AnalytixInsight | FLYHT Aerospace vs. Baylin Technologies | FLYHT Aerospace vs. Bewhere Holdings |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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