Correlation Between Spectrum Brands and Helen Of
Can any of the company-specific risk be diversified away by investing in both Spectrum Brands and Helen Of 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 Helen Of 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 Helen of Troy, you can compare the effects of market volatilities on Spectrum Brands and Helen Of 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 Helen Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spectrum Brands and Helen Of.
Diversification Opportunities for Spectrum Brands and Helen Of
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Spectrum and Helen is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Spectrum Brands Holdings and Helen of Troy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helen of Troy 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 Helen Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helen of Troy has no effect on the direction of Spectrum Brands i.e., Spectrum Brands and Helen Of go up and down completely randomly.
Pair Corralation between Spectrum Brands and Helen Of
Considering the 90-day investment horizon Spectrum Brands Holdings is expected to generate 0.58 times more return on investment than Helen Of. However, Spectrum Brands Holdings is 1.72 times less risky than Helen Of. It trades about 0.05 of its potential returns per unit of risk. Helen of Troy is currently generating about -0.02 per unit of risk. If you would invest 6,348 in Spectrum Brands Holdings on August 27, 2024 and sell it today you would earn a total of 2,697 from holding Spectrum Brands Holdings or generate 42.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spectrum Brands Holdings vs. Helen of Troy
Performance |
| Timeline |
| Spectrum Brands Holdings |
| Helen of Troy |
Spectrum Brands and Helen Of Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spectrum Brands and Helen Of
The main advantage of trading using opposite Spectrum Brands and Helen Of positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spectrum Brands position performs unexpectedly, Helen Of 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 Helen Of will offset losses from the drop in Helen Of'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 |
| Helen Of vs. Inter Parfums | Helen Of vs. J J Snack | Helen Of vs. Lancaster Colony | Helen Of vs. Dorman Products |
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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