Correlation Between Hanesbrands and Grupa KTY
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Grupa KTY 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 Grupa KTY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Grupa KTY SA, you can compare the effects of market volatilities on Hanesbrands and Grupa KTY 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 Grupa KTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Grupa KTY.
Diversification Opportunities for Hanesbrands and Grupa KTY
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hanesbrands and Grupa is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Grupa KTY SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupa KTY SA 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 Grupa KTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupa KTY SA has no effect on the direction of Hanesbrands i.e., Hanesbrands and Grupa KTY go up and down completely randomly.
Pair Corralation between Hanesbrands and Grupa KTY
Considering the 90-day investment horizon Hanesbrands is expected to generate 2.22 times more return on investment than Grupa KTY. However, Hanesbrands is 2.22 times more volatile than Grupa KTY SA. It trades about 0.2 of its potential returns per unit of risk. Grupa KTY SA is currently generating about 0.15 per unit of risk. If you would invest 721.00 in Hanesbrands on September 6, 2024 and sell it today you would earn a total of 137.00 from holding Hanesbrands or generate 19.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanesbrands vs. Grupa KTY SA
Performance |
| Timeline |
| Hanesbrands |
| Grupa KTY SA |
Hanesbrands and Grupa KTY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Grupa KTY
The main advantage of trading using opposite Hanesbrands and Grupa KTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Grupa KTY 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 Grupa KTY will offset losses from the drop in Grupa KTY'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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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