Correlation Between PVH Corp and Culp
Can any of the company-specific risk be diversified away by investing in both PVH Corp and Culp 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 PVH Corp and Culp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PVH Corp and Culp Inc, you can compare the effects of market volatilities on PVH Corp and Culp 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 PVH Corp with a short position of Culp. Check out your portfolio center. Please also check ongoing floating volatility patterns of PVH Corp and Culp.
Diversification Opportunities for PVH Corp and Culp
Very good diversification
The 3 months correlation between PVH and Culp is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding PVH Corp and Culp Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Culp Inc and PVH Corp 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 PVH Corp are associated (or correlated) with Culp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Culp Inc has no effect on the direction of PVH Corp i.e., PVH Corp and Culp go up and down completely randomly.
Pair Corralation between PVH Corp and Culp
Considering the 90-day investment horizon PVH Corp is expected to generate 1.26 times more return on investment than Culp. However, PVH Corp is 1.26 times more volatile than Culp Inc. It trades about 0.19 of its potential returns per unit of risk. Culp Inc is currently generating about -0.13 per unit of risk. If you would invest 9,878 in PVH Corp on August 31, 2024 and sell it today you would earn a total of 810.00 from holding PVH Corp or generate 8.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PVH Corp vs. Culp Inc
Performance |
| Timeline |
| PVH Corp |
| Culp Inc |
PVH Corp and Culp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PVH Corp and Culp
The main advantage of trading using opposite PVH Corp and Culp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PVH Corp position performs unexpectedly, Culp 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 Culp will offset losses from the drop in Culp's long position.| PVH Corp vs. Levi Strauss Co | PVH Corp vs. Hanesbrands | PVH Corp vs. VF Corporation | PVH Corp vs. Oxford Industries |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |