Correlation Between JJill and PVH Corp
Can any of the company-specific risk be diversified away by investing in both JJill and PVH Corp 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 JJill and PVH Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JJill Inc and PVH Corp, you can compare the effects of market volatilities on JJill and PVH Corp 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 JJill with a short position of PVH Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of JJill and PVH Corp.
Diversification Opportunities for JJill and PVH Corp
Very poor diversification
The 3 months correlation between JJill and PVH is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding JJill Inc and PVH Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PVH Corp and JJill 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 JJill Inc are associated (or correlated) with PVH Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PVH Corp has no effect on the direction of JJill i.e., JJill and PVH Corp go up and down completely randomly.
Pair Corralation between JJill and PVH Corp
Given the investment horizon of 90 days JJill is expected to generate 1.05 times less return on investment than PVH Corp. In addition to that, JJill is 1.24 times more volatile than PVH Corp. It trades about 0.13 of its total potential returns per unit of risk. PVH Corp is currently generating about 0.17 per unit of volatility. If you would invest 10,234 in PVH Corp on September 12, 2024 and sell it today you would earn a total of 742.00 from holding PVH Corp or generate 7.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
JJill Inc vs. PVH Corp
Performance |
| Timeline |
| JJill Inc |
| PVH Corp |
JJill and PVH Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JJill and PVH Corp
The main advantage of trading using opposite JJill and PVH Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JJill position performs unexpectedly, PVH Corp 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 PVH Corp will offset losses from the drop in PVH Corp's long position.The idea behind JJill Inc and PVH Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| PVH Corp vs. VF Corporation | PVH Corp vs. Levi Strauss Co | PVH Corp vs. Under Armour A | PVH Corp vs. Columbia Sportswear |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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