Correlation Between Rocky Brands and GigaCloud Technology
Can any of the company-specific risk be diversified away by investing in both Rocky Brands and GigaCloud Technology 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 Rocky Brands and GigaCloud Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rocky Brands and GigaCloud Technology Class, you can compare the effects of market volatilities on Rocky Brands and GigaCloud Technology 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 Rocky Brands with a short position of GigaCloud Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rocky Brands and GigaCloud Technology.
Diversification Opportunities for Rocky Brands and GigaCloud Technology
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rocky and GigaCloud is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Rocky Brands and GigaCloud Technology Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GigaCloud Technology and Rocky Brands 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 Rocky Brands are associated (or correlated) with GigaCloud Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GigaCloud Technology has no effect on the direction of Rocky Brands i.e., Rocky Brands and GigaCloud Technology go up and down completely randomly.
Pair Corralation between Rocky Brands and GigaCloud Technology
Given the investment horizon of 90 days Rocky Brands is expected to generate 6.23 times less return on investment than GigaCloud Technology. But when comparing it to its historical volatility, Rocky Brands is 1.41 times less risky than GigaCloud Technology. It trades about 0.02 of its potential returns per unit of risk. GigaCloud Technology Class is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 506.00 in GigaCloud Technology Class on November 19, 2024 and sell it today you would earn a total of 1,540 from holding GigaCloud Technology Class or generate 304.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rocky Brands vs. GigaCloud Technology Class
Performance |
| Timeline |
| Rocky Brands |
| GigaCloud Technology |
Rocky Brands and GigaCloud Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rocky Brands and GigaCloud Technology
The main advantage of trading using opposite Rocky Brands and GigaCloud Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rocky Brands position performs unexpectedly, GigaCloud Technology 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 GigaCloud Technology will offset losses from the drop in GigaCloud Technology's long position.| Rocky Brands vs. Vera Bradley | Rocky Brands vs. Steven Madden | Rocky Brands vs. Wolverine World Wide | Rocky Brands vs. Caleres |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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