Correlation Between Steven Madden and Almacenes Xito
Can any of the company-specific risk be diversified away by investing in both Steven Madden and Almacenes Xito 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 Steven Madden and Almacenes Xito into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steven Madden and Almacenes xito SA, you can compare the effects of market volatilities on Steven Madden and Almacenes Xito 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 Steven Madden with a short position of Almacenes Xito. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steven Madden and Almacenes Xito.
Diversification Opportunities for Steven Madden and Almacenes Xito
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Steven and Almacenes is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Steven Madden and Almacenes xito SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almacenes xito SA and Steven Madden 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 Steven Madden are associated (or correlated) with Almacenes Xito. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almacenes xito SA has no effect on the direction of Steven Madden i.e., Steven Madden and Almacenes Xito go up and down completely randomly.
Pair Corralation between Steven Madden and Almacenes Xito
Given the investment horizon of 90 days Steven Madden is expected to generate 0.61 times more return on investment than Almacenes Xito. However, Steven Madden is 1.65 times less risky than Almacenes Xito. It trades about 0.05 of its potential returns per unit of risk. Almacenes xito SA is currently generating about -0.03 per unit of risk. If you would invest 3,223 in Steven Madden on August 28, 2024 and sell it today you would earn a total of 1,318 from holding Steven Madden or generate 40.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 64.24% |
| Values | Daily Returns |
Steven Madden vs. Almacenes xito SA
Performance |
| Timeline |
| Steven Madden |
| Almacenes xito SA |
Steven Madden and Almacenes Xito Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steven Madden and Almacenes Xito
The main advantage of trading using opposite Steven Madden and Almacenes Xito positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steven Madden position performs unexpectedly, Almacenes Xito 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 Almacenes Xito will offset losses from the drop in Almacenes Xito's long position.| Steven Madden vs. Weyco Group | Steven Madden vs. Caleres | Steven Madden vs. Rocky Brands | Steven Madden vs. Designer Brands |
| Almacenes Xito vs. MOGU Inc | Almacenes Xito vs. iPower Inc | Almacenes Xito vs. Jeffs Brands | Almacenes Xito vs. Kidpik Corp |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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