Correlation Between Steven Madden and Funko
Can any of the company-specific risk be diversified away by investing in both Steven Madden and Funko 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 Funko into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steven Madden and Funko Inc, you can compare the effects of market volatilities on Steven Madden and Funko 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 Funko. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steven Madden and Funko.
Diversification Opportunities for Steven Madden and Funko
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Steven and Funko is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Steven Madden and Funko Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Funko Inc 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 Funko. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Funko Inc has no effect on the direction of Steven Madden i.e., Steven Madden and Funko go up and down completely randomly.
Pair Corralation between Steven Madden and Funko
Given the investment horizon of 90 days Steven Madden is expected to generate 2.79 times less return on investment than Funko. But when comparing it to its historical volatility, Steven Madden is 2.17 times less risky than Funko. It trades about 0.02 of its potential returns per unit of risk. Funko Inc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,081 in Funko Inc on November 19, 2024 and sell it today you would earn a total of 277.00 from holding Funko Inc or generate 25.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Steven Madden vs. Funko Inc
Performance |
| Timeline |
| Steven Madden |
| Funko Inc |
Steven Madden and Funko Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steven Madden and Funko
The main advantage of trading using opposite Steven Madden and Funko positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steven Madden position performs unexpectedly, Funko 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 Funko will offset losses from the drop in Funko's long position.| Steven Madden vs. Weyco Group | Steven Madden vs. Caleres | Steven Madden vs. Rocky Brands | Steven Madden vs. Designer Brands |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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