Correlation Between Rocky Brands and Getty Realty
Can any of the company-specific risk be diversified away by investing in both Rocky Brands and Getty Realty 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 Getty Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rocky Brands and Getty Realty, you can compare the effects of market volatilities on Rocky Brands and Getty Realty 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 Getty Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rocky Brands and Getty Realty.
Diversification Opportunities for Rocky Brands and Getty Realty
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Rocky and Getty is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Rocky Brands and Getty Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Realty 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 Getty Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Realty has no effect on the direction of Rocky Brands i.e., Rocky Brands and Getty Realty go up and down completely randomly.
Pair Corralation between Rocky Brands and Getty Realty
Given the investment horizon of 90 days Rocky Brands is expected to generate 3.35 times more return on investment than Getty Realty. However, Rocky Brands is 3.35 times more volatile than Getty Realty. It trades about 0.02 of its potential returns per unit of risk. Getty Realty is currently generating about 0.01 per unit of risk. If you would invest 2,744 in Rocky Brands on November 2, 2024 and sell it today you would lose (225.50) from holding Rocky Brands or give up 8.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Rocky Brands vs. Getty Realty
Performance |
| Timeline |
| Rocky Brands |
| Getty Realty |
Rocky Brands and Getty Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rocky Brands and Getty Realty
The main advantage of trading using opposite Rocky Brands and Getty Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rocky Brands position performs unexpectedly, Getty Realty 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 Getty Realty will offset losses from the drop in Getty Realty'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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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