Correlation Between FLOW TRADERS and G-III Apparel
Can any of the company-specific risk be diversified away by investing in both FLOW TRADERS and G-III Apparel 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 FLOW TRADERS and G-III Apparel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FLOW TRADERS LTD and G III Apparel Group, you can compare the effects of market volatilities on FLOW TRADERS and G-III Apparel 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 FLOW TRADERS with a short position of G-III Apparel. Check out your portfolio center. Please also check ongoing floating volatility patterns of FLOW TRADERS and G-III Apparel.
Diversification Opportunities for FLOW TRADERS and G-III Apparel
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FLOW and G-III is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding FLOW TRADERS LTD and G III Apparel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G III Apparel and FLOW TRADERS 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 FLOW TRADERS LTD are associated (or correlated) with G-III Apparel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G III Apparel has no effect on the direction of FLOW TRADERS i.e., FLOW TRADERS and G-III Apparel go up and down completely randomly.
Pair Corralation between FLOW TRADERS and G-III Apparel
Assuming the 90 days horizon FLOW TRADERS LTD is expected to generate 0.44 times more return on investment than G-III Apparel. However, FLOW TRADERS LTD is 2.27 times less risky than G-III Apparel. It trades about 0.15 of its potential returns per unit of risk. G III Apparel Group is currently generating about 0.06 per unit of risk. If you would invest 2,100 in FLOW TRADERS LTD on October 11, 2024 and sell it today you would earn a total of 72.00 from holding FLOW TRADERS LTD or generate 3.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
FLOW TRADERS LTD vs. G III Apparel Group
Performance |
| Timeline |
| FLOW TRADERS LTD |
| G III Apparel |
FLOW TRADERS and G-III Apparel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FLOW TRADERS and G-III Apparel
The main advantage of trading using opposite FLOW TRADERS and G-III Apparel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FLOW TRADERS position performs unexpectedly, G-III Apparel 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 G-III Apparel will offset losses from the drop in G-III Apparel's long position.| FLOW TRADERS vs. United Breweries Co | FLOW TRADERS vs. THAI BEVERAGE | FLOW TRADERS vs. AAC TECHNOLOGHLDGADR | FLOW TRADERS vs. Amkor Technology |
| G-III Apparel vs. Ribbon Communications | G-III Apparel vs. Ares Management Corp | G-III Apparel vs. CEOTRONICS | G-III Apparel vs. GMO Internet |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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