Correlation Between Steven Madden and Vera Bradley
Can any of the company-specific risk be diversified away by investing in both Steven Madden and Vera Bradley 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 Vera Bradley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steven Madden and Vera Bradley, you can compare the effects of market volatilities on Steven Madden and Vera Bradley 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 Vera Bradley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steven Madden and Vera Bradley.
Diversification Opportunities for Steven Madden and Vera Bradley
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Steven and Vera is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Steven Madden and Vera Bradley in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vera Bradley 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 Vera Bradley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vera Bradley has no effect on the direction of Steven Madden i.e., Steven Madden and Vera Bradley go up and down completely randomly.
Pair Corralation between Steven Madden and Vera Bradley
Given the investment horizon of 90 days Steven Madden is expected to generate 0.5 times more return on investment than Vera Bradley. However, Steven Madden is 1.99 times less risky than Vera Bradley. It trades about 0.01 of its potential returns per unit of risk. Vera Bradley is currently generating about -0.07 per unit of risk. If you would invest 4,122 in Steven Madden on October 20, 2024 and sell it today you would lose (10.00) from holding Steven Madden or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Steven Madden vs. Vera Bradley
Performance |
| Timeline |
| Steven Madden |
| Vera Bradley |
Steven Madden and Vera Bradley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steven Madden and Vera Bradley
The main advantage of trading using opposite Steven Madden and Vera Bradley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steven Madden position performs unexpectedly, Vera Bradley 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 Vera Bradley will offset losses from the drop in Vera Bradley's long position.| Steven Madden vs. Weyco Group | Steven Madden vs. Caleres | Steven Madden vs. Rocky Brands | Steven Madden vs. Designer Brands |
| Vera Bradley vs. Rocky Brands | Vera Bradley vs. Steven Madden | Vera Bradley vs. Wolverine World Wide | Vera Bradley vs. Caleres |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |