Correlation Between Steven Madden and Primega Group
Can any of the company-specific risk be diversified away by investing in both Steven Madden and Primega Group 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 Primega Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steven Madden and Primega Group Holdings, you can compare the effects of market volatilities on Steven Madden and Primega Group 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 Primega Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steven Madden and Primega Group.
Diversification Opportunities for Steven Madden and Primega Group
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Steven and Primega is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Steven Madden and Primega Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Primega Group Holdings 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 Primega Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Primega Group Holdings has no effect on the direction of Steven Madden i.e., Steven Madden and Primega Group go up and down completely randomly.
Pair Corralation between Steven Madden and Primega Group
Given the investment horizon of 90 days Steven Madden is expected to generate 208.16 times less return on investment than Primega Group. But when comparing it to its historical volatility, Steven Madden is 58.27 times less risky than Primega Group. It trades about 0.03 of its potential returns per unit of risk. Primega Group Holdings is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 422.00 in Primega Group Holdings on September 1, 2024 and sell it today you would lose (184.00) from holding Primega Group Holdings or give up 43.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 48.94% |
| Values | Daily Returns |
Steven Madden vs. Primega Group Holdings
Performance |
| Timeline |
| Steven Madden |
| Primega Group Holdings |
Steven Madden and Primega Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steven Madden and Primega Group
The main advantage of trading using opposite Steven Madden and Primega Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steven Madden position performs unexpectedly, Primega Group 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 Primega Group will offset losses from the drop in Primega Group's long position.| Steven Madden vs. Deckers Outdoor | Steven Madden vs. On Holding | Steven Madden vs. Crocs Inc | Steven Madden vs. Designer Brands |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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