Correlation Between Hanesbrands and Utilities Fund
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Utilities Fund 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 Utilities Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Utilities Fund Class, you can compare the effects of market volatilities on Hanesbrands and Utilities Fund 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 Utilities Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Utilities Fund.
Diversification Opportunities for Hanesbrands and Utilities Fund
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hanesbrands and Utilities is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Utilities Fund Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Utilities Fund Class 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 Utilities Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Utilities Fund Class has no effect on the direction of Hanesbrands i.e., Hanesbrands and Utilities Fund go up and down completely randomly.
Pair Corralation between Hanesbrands and Utilities Fund
Considering the 90-day investment horizon Hanesbrands is expected to generate 3.24 times more return on investment than Utilities Fund. However, Hanesbrands is 3.24 times more volatile than Utilities Fund Class. It trades about 0.17 of its potential returns per unit of risk. Utilities Fund Class is currently generating about 0.03 per unit of risk. If you would invest 640.00 in Hanesbrands on September 12, 2024 and sell it today you would earn a total of 226.00 from holding Hanesbrands or generate 35.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanesbrands vs. Utilities Fund Class
Performance |
| Timeline |
| Hanesbrands |
| Utilities Fund Class |
Hanesbrands and Utilities Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Utilities Fund
The main advantage of trading using opposite Hanesbrands and Utilities Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Utilities Fund 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 Utilities Fund will offset losses from the drop in Utilities Fund's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
| Utilities Fund vs. Allianzgi Health Sciences | Utilities Fund vs. Live Oak Health | Utilities Fund vs. Deutsche Health And | Utilities Fund vs. Health Biotchnology Portfolio |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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