Correlation Between Under Armour and BCE
Can any of the company-specific risk be diversified away by investing in both Under Armour and BCE 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 Under Armour and BCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Under Armour C and BCE Inc, you can compare the effects of market volatilities on Under Armour and BCE 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 Under Armour with a short position of BCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Under Armour and BCE.
Diversification Opportunities for Under Armour and BCE
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Under and BCE is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Under Armour C and BCE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCE Inc and Under Armour 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 Under Armour C are associated (or correlated) with BCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCE Inc has no effect on the direction of Under Armour i.e., Under Armour and BCE go up and down completely randomly.
Pair Corralation between Under Armour and BCE
Allowing for the 90-day total investment horizon Under Armour C is expected to generate 2.83 times more return on investment than BCE. However, Under Armour is 2.83 times more volatile than BCE Inc. It trades about 0.09 of its potential returns per unit of risk. BCE Inc is currently generating about -0.45 per unit of risk. If you would invest 793.00 in Under Armour C on August 24, 2024 and sell it today you would earn a total of 68.50 from holding Under Armour C or generate 8.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Under Armour C vs. BCE Inc
Performance |
| Timeline |
| Under Armour C |
| BCE Inc |
Under Armour and BCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Under Armour and BCE
The main advantage of trading using opposite Under Armour and BCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Under Armour position performs unexpectedly, BCE 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 BCE will offset losses from the drop in BCE's long position.| Under Armour vs. Levi Strauss Co | Under Armour vs. Columbia Sportswear | Under Armour vs. Hanesbrands | Under Armour vs. PVH Corp |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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