Correlation Between Industria and Urban Outfitters
Can any of the company-specific risk be diversified away by investing in both Industria and Urban Outfitters 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 Industria and Urban Outfitters into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Industria de Diseno and Urban Outfitters, you can compare the effects of market volatilities on Industria and Urban Outfitters 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 Industria with a short position of Urban Outfitters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industria and Urban Outfitters.
Diversification Opportunities for Industria and Urban Outfitters
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Industria and Urban is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Industria de Diseno and Urban Outfitters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Urban Outfitters and Industria 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 Industria de Diseno are associated (or correlated) with Urban Outfitters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Urban Outfitters has no effect on the direction of Industria i.e., Industria and Urban Outfitters go up and down completely randomly.
Pair Corralation between Industria and Urban Outfitters
Assuming the 90 days trading horizon Industria de Diseno is expected to generate 0.53 times more return on investment than Urban Outfitters. However, Industria de Diseno is 1.88 times less risky than Urban Outfitters. It trades about 0.17 of its potential returns per unit of risk. Urban Outfitters is currently generating about 0.01 per unit of risk. If you would invest 4,966 in Industria de Diseno on November 2, 2024 and sell it today you would earn a total of 284.00 from holding Industria de Diseno or generate 5.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industria de Diseno vs. Urban Outfitters
Performance |
| Timeline |
| Industria de Diseno |
| Urban Outfitters |
Industria and Urban Outfitters Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industria and Urban Outfitters
The main advantage of trading using opposite Industria and Urban Outfitters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industria position performs unexpectedly, Urban Outfitters 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 Urban Outfitters will offset losses from the drop in Urban Outfitters' long position.| Industria vs. USWE SPORTS AB | Industria vs. Playa Hotels Resorts | Industria vs. PLAY2CHILL SA ZY | Industria vs. China BlueChemical |
| Urban Outfitters vs. Firan Technology Group | Urban Outfitters vs. AMAG Austria Metall | Urban Outfitters vs. Cognizant Technology Solutions | Urban Outfitters vs. Transport International Holdings |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Stocks Directory Find actively traded stocks across global markets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |