Correlation Between Pinstripes Holdings and Sleep Number
Can any of the company-specific risk be diversified away by investing in both Pinstripes Holdings and Sleep Number 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 Pinstripes Holdings and Sleep Number into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pinstripes Holdings and Sleep Number Corp, you can compare the effects of market volatilities on Pinstripes Holdings and Sleep Number 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 Pinstripes Holdings with a short position of Sleep Number. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinstripes Holdings and Sleep Number.
Diversification Opportunities for Pinstripes Holdings and Sleep Number
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pinstripes and Sleep is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Pinstripes Holdings and Sleep Number Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sleep Number Corp and Pinstripes Holdings 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 Pinstripes Holdings are associated (or correlated) with Sleep Number. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sleep Number Corp has no effect on the direction of Pinstripes Holdings i.e., Pinstripes Holdings and Sleep Number go up and down completely randomly.
Pair Corralation between Pinstripes Holdings and Sleep Number
Given the investment horizon of 90 days Pinstripes Holdings is expected to generate 2.07 times less return on investment than Sleep Number. In addition to that, Pinstripes Holdings is 2.14 times more volatile than Sleep Number Corp. It trades about 0.04 of its total potential returns per unit of risk. Sleep Number Corp is currently generating about 0.17 per unit of volatility. If you would invest 1,507 in Sleep Number Corp on November 9, 2024 and sell it today you would earn a total of 189.00 from holding Sleep Number Corp or generate 12.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pinstripes Holdings vs. Sleep Number Corp
Performance |
| Timeline |
| Pinstripes Holdings |
| Sleep Number Corp |
Pinstripes Holdings and Sleep Number Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pinstripes Holdings and Sleep Number
The main advantage of trading using opposite Pinstripes Holdings and Sleep Number positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pinstripes Holdings position performs unexpectedly, Sleep Number 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 Sleep Number will offset losses from the drop in Sleep Number's long position.| Pinstripes Holdings vs. Acumen Pharmaceuticals | Pinstripes Holdings vs. Enzyme Environmental Solutions | Pinstripes Holdings vs. Molecular Partners AG | Pinstripes Holdings vs. Catalyst Pharmaceuticals |
| Sleep Number vs. Purple Innovation | Sleep Number vs. Mohawk Industries | Sleep Number vs. La Z Boy Incorporated | Sleep Number vs. Leggett Platt Incorporated |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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