Correlation Between Hanesbrands and Xtrackers Russell
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Xtrackers Russell 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 Xtrackers Russell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Xtrackers Russell 2000, you can compare the effects of market volatilities on Hanesbrands and Xtrackers Russell 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 Xtrackers Russell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Xtrackers Russell.
Diversification Opportunities for Hanesbrands and Xtrackers Russell
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hanesbrands and Xtrackers is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Xtrackers Russell 2000 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers Russell 2000 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 Xtrackers Russell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers Russell 2000 has no effect on the direction of Hanesbrands i.e., Hanesbrands and Xtrackers Russell go up and down completely randomly.
Pair Corralation between Hanesbrands and Xtrackers Russell
Considering the 90-day investment horizon Hanesbrands is expected to generate 1.3 times more return on investment than Xtrackers Russell. However, Hanesbrands is 1.3 times more volatile than Xtrackers Russell 2000. It trades about 0.21 of its potential returns per unit of risk. Xtrackers Russell 2000 is currently generating about 0.21 per unit of risk. If you would invest 712.00 in Hanesbrands on September 5, 2024 and sell it today you would earn a total of 146.00 from holding Hanesbrands or generate 20.51% 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. Xtrackers Russell 2000
Performance |
| Timeline |
| Hanesbrands |
| Xtrackers Russell 2000 |
Hanesbrands and Xtrackers Russell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanesbrands and Xtrackers Russell
The main advantage of trading using opposite Hanesbrands and Xtrackers Russell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Xtrackers Russell 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 Xtrackers Russell will offset losses from the drop in Xtrackers Russell's long position.| Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
| Xtrackers Russell vs. Xtrackers MSCI USA | Xtrackers Russell vs. Xtrackers USD Corporate | Xtrackers Russell vs. Xtrackers MSCI AC | Xtrackers Russell vs. Xtrackers MSCI World |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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