Correlation Between Lakeland Industries and Columbia Sportswear
Can any of the company-specific risk be diversified away by investing in both Lakeland Industries and Columbia Sportswear 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 Lakeland Industries and Columbia Sportswear into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lakeland Industries and Columbia Sportswear, you can compare the effects of market volatilities on Lakeland Industries and Columbia Sportswear 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 Lakeland Industries with a short position of Columbia Sportswear. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lakeland Industries and Columbia Sportswear.
Diversification Opportunities for Lakeland Industries and Columbia Sportswear
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Lakeland and Columbia is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Lakeland Industries and Columbia Sportswear in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Sportswear and Lakeland Industries 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 Lakeland Industries are associated (or correlated) with Columbia Sportswear. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Sportswear has no effect on the direction of Lakeland Industries i.e., Lakeland Industries and Columbia Sportswear go up and down completely randomly.
Pair Corralation between Lakeland Industries and Columbia Sportswear
Given the investment horizon of 90 days Lakeland Industries is expected to under-perform the Columbia Sportswear. In addition to that, Lakeland Industries is 1.51 times more volatile than Columbia Sportswear. It trades about -0.03 of its total potential returns per unit of risk. Columbia Sportswear is currently generating about 0.08 per unit of volatility. If you would invest 8,032 in Columbia Sportswear on August 28, 2024 and sell it today you would earn a total of 660.00 from holding Columbia Sportswear or generate 8.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lakeland Industries vs. Columbia Sportswear
Performance |
| Timeline |
| Lakeland Industries |
| Columbia Sportswear |
Lakeland Industries and Columbia Sportswear Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lakeland Industries and Columbia Sportswear
The main advantage of trading using opposite Lakeland Industries and Columbia Sportswear positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lakeland Industries position performs unexpectedly, Columbia Sportswear 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 Columbia Sportswear will offset losses from the drop in Columbia Sportswear's long position.| Lakeland Industries vs. Vince Holding Corp | Lakeland Industries vs. Oxford Industries | Lakeland Industries vs. Gildan Activewear | Lakeland Industries vs. Columbia Sportswear |
| Columbia Sportswear vs. Vince Holding Corp | Columbia Sportswear vs. Ermenegildo Zegna NV | Columbia Sportswear vs. Gildan Activewear | Columbia Sportswear vs. G III Apparel Group |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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