Correlation Between Hanesbrands and Voya Retirement
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Voya Retirement 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 Voya Retirement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Voya Retirement Moderate, you can compare the effects of market volatilities on Hanesbrands and Voya Retirement 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 Voya Retirement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Voya Retirement.
Diversification Opportunities for Hanesbrands and Voya Retirement
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hanesbrands and Voya is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Voya Retirement Moderate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Retirement Moderate 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 Voya Retirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Retirement Moderate has no effect on the direction of Hanesbrands i.e., Hanesbrands and Voya Retirement go up and down completely randomly.
Pair Corralation between Hanesbrands and Voya Retirement
Considering the 90-day investment horizon Hanesbrands is expected to generate 6.99 times more return on investment than Voya Retirement. However, Hanesbrands is 6.99 times more volatile than Voya Retirement Moderate. It trades about 0.1 of its potential returns per unit of risk. Voya Retirement Moderate is currently generating about 0.12 per unit of risk. If you would invest 400.00 in Hanesbrands on September 12, 2024 and sell it today you would earn a total of 441.00 from holding Hanesbrands or generate 110.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Hanesbrands vs. Voya Retirement Moderate
Performance |
| Timeline |
| Hanesbrands |
| Voya Retirement Moderate |
Hanesbrands and Voya Retirement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Voya Retirement
The main advantage of trading using opposite Hanesbrands and Voya Retirement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Voya Retirement 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 Voya Retirement will offset losses from the drop in Voya Retirement's 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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