Correlation Between Hanesbrands and Inflation Protection
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Inflation Protection 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 Inflation Protection into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Inflation Protection Fund, you can compare the effects of market volatilities on Hanesbrands and Inflation Protection 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 Inflation Protection. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Inflation Protection.
Diversification Opportunities for Hanesbrands and Inflation Protection
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hanesbrands and Inflation is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Inflation Protection Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflation Protection 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 Inflation Protection. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflation Protection has no effect on the direction of Hanesbrands i.e., Hanesbrands and Inflation Protection go up and down completely randomly.
Pair Corralation between Hanesbrands and Inflation Protection
Considering the 90-day investment horizon Hanesbrands is expected to generate 10.13 times more return on investment than Inflation Protection. However, Hanesbrands is 10.13 times more volatile than Inflation Protection Fund. It trades about 0.07 of its potential returns per unit of risk. Inflation Protection Fund is currently generating about 0.03 per unit of risk. If you would invest 469.00 in Hanesbrands on September 4, 2024 and sell it today you would earn a total of 422.00 from holding Hanesbrands or generate 89.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Hanesbrands vs. Inflation Protection Fund
Performance |
| Timeline |
| Hanesbrands |
| Inflation Protection |
Hanesbrands and Inflation Protection Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Inflation Protection
The main advantage of trading using opposite Hanesbrands and Inflation Protection positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Inflation Protection 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 Inflation Protection will offset losses from the drop in Inflation Protection's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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