Correlation Between Lands End and Whirlpool
Can any of the company-specific risk be diversified away by investing in both Lands End and Whirlpool 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 Lands End and Whirlpool into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lands End and Whirlpool, you can compare the effects of market volatilities on Lands End and Whirlpool 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 Lands End with a short position of Whirlpool. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lands End and Whirlpool.
Diversification Opportunities for Lands End and Whirlpool
Excellent diversification
The 3 months correlation between Lands and Whirlpool is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Lands End and Whirlpool in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Whirlpool and Lands End 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 Lands End are associated (or correlated) with Whirlpool. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Whirlpool has no effect on the direction of Lands End i.e., Lands End and Whirlpool go up and down completely randomly.
Pair Corralation between Lands End and Whirlpool
Allowing for the 90-day total investment horizon Lands End is expected to under-perform the Whirlpool. In addition to that, Lands End is 1.16 times more volatile than Whirlpool. It trades about -0.03 of its total potential returns per unit of risk. Whirlpool is currently generating about 0.05 per unit of volatility. If you would invest 9,666 in Whirlpool on November 2, 2024 and sell it today you would earn a total of 1,173 from holding Whirlpool or generate 12.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lands End vs. Whirlpool
Performance |
| Timeline |
| Lands End |
| Whirlpool |
Lands End and Whirlpool Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lands End and Whirlpool
The main advantage of trading using opposite Lands End and Whirlpool positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lands End position performs unexpectedly, Whirlpool 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 Whirlpool will offset losses from the drop in Whirlpool's long position.| Lands End vs. Tillys Inc | Lands End vs. Zumiez Inc | Lands End vs. Citi Trends | Lands End vs. Cato Corporation |
| Whirlpool vs. Ethan Allen Interiors | Whirlpool vs. Mohawk Industries | Whirlpool vs. Tempur Sealy International | Whirlpool vs. MillerKnoll |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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