Correlation Between Oxford Industries and Carters
Can any of the company-specific risk be diversified away by investing in both Oxford Industries and Carters 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 Oxford Industries and Carters into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oxford Industries and Carters, you can compare the effects of market volatilities on Oxford Industries and Carters 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 Oxford Industries with a short position of Carters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxford Industries and Carters.
Diversification Opportunities for Oxford Industries and Carters
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oxford and Carters is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Industries and Carters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carters and Oxford 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 Oxford Industries are associated (or correlated) with Carters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carters has no effect on the direction of Oxford Industries i.e., Oxford Industries and Carters go up and down completely randomly.
Pair Corralation between Oxford Industries and Carters
Considering the 90-day investment horizon Oxford Industries is expected to generate 0.98 times more return on investment than Carters. However, Oxford Industries is 1.02 times less risky than Carters. It trades about 0.21 of its potential returns per unit of risk. Carters is currently generating about 0.01 per unit of risk. If you would invest 7,548 in Oxford Industries on August 30, 2024 and sell it today you would earn a total of 749.00 from holding Oxford Industries or generate 9.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oxford Industries vs. Carters
Performance |
| Timeline |
| Oxford Industries |
| Carters |
Oxford Industries and Carters Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oxford Industries and Carters
The main advantage of trading using opposite Oxford Industries and Carters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxford Industries position performs unexpectedly, Carters 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 Carters will offset losses from the drop in Carters' long position.| Oxford Industries vs. G III Apparel Group | Oxford Industries vs. Ermenegildo Zegna NV | Oxford Industries vs. Kontoor Brands | Oxford Industries vs. Columbia Sportswear |
| Carters vs. VF Corporation | Carters vs. Levi Strauss Co | Carters vs. Under Armour A | Carters 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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