Correlation Between Spectrum Brands and Church Dwight
Can any of the company-specific risk be diversified away by investing in both Spectrum Brands and Church Dwight 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 Spectrum Brands and Church Dwight into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spectrum Brands Holdings and Church Dwight, you can compare the effects of market volatilities on Spectrum Brands and Church Dwight 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 Spectrum Brands with a short position of Church Dwight. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spectrum Brands and Church Dwight.
Diversification Opportunities for Spectrum Brands and Church Dwight
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Spectrum and Church is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Spectrum Brands Holdings and Church Dwight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Church Dwight and Spectrum 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 Spectrum Brands Holdings are associated (or correlated) with Church Dwight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Church Dwight has no effect on the direction of Spectrum Brands i.e., Spectrum Brands and Church Dwight go up and down completely randomly.
Pair Corralation between Spectrum Brands and Church Dwight
Considering the 90-day investment horizon Spectrum Brands is expected to generate 1.32 times less return on investment than Church Dwight. In addition to that, Spectrum Brands is 1.41 times more volatile than Church Dwight. It trades about 0.03 of its total potential returns per unit of risk. Church Dwight is currently generating about 0.05 per unit of volatility. If you would invest 9,980 in Church Dwight on October 22, 2024 and sell it today you would earn a total of 667.00 from holding Church Dwight or generate 6.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spectrum Brands Holdings vs. Church Dwight
Performance |
| Timeline |
| Spectrum Brands Holdings |
| Church Dwight |
Spectrum Brands and Church Dwight Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spectrum Brands and Church Dwight
The main advantage of trading using opposite Spectrum Brands and Church Dwight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spectrum Brands position performs unexpectedly, Church Dwight 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 Church Dwight will offset losses from the drop in Church Dwight's long position.| Spectrum Brands vs. European Wax Center | Spectrum Brands vs. Inter Parfums | Spectrum Brands vs. Mannatech Incorporated | Spectrum Brands vs. Nu Skin Enterprises |
| Church Dwight vs. Kimberly Clark | Church Dwight vs. Colgate Palmolive | Church Dwight vs. Unilever PLC ADR | Church Dwight vs. Procter Gamble |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |