Correlation Between Under Armour and H M
Can any of the company-specific risk be diversified away by investing in both Under Armour and H M 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 H M 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 H M Hennes, you can compare the effects of market volatilities on Under Armour and H M 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 H M. Check out your portfolio center. Please also check ongoing floating volatility patterns of Under Armour and H M.
Diversification Opportunities for Under Armour and H M
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Under and HNNMY is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Under Armour C and H M Hennes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on H M Hennes 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 H M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of H M Hennes has no effect on the direction of Under Armour i.e., Under Armour and H M go up and down completely randomly.
Pair Corralation between Under Armour and H M
Allowing for the 90-day total investment horizon Under Armour C is expected to under-perform the H M. In addition to that, Under Armour is 1.17 times more volatile than H M Hennes. It trades about 0.0 of its total potential returns per unit of risk. H M Hennes is currently generating about 0.03 per unit of volatility. If you would invest 225.00 in H M Hennes on November 1, 2024 and sell it today you would earn a total of 51.00 from holding H M Hennes or generate 22.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Under Armour C vs. H M Hennes
Performance |
| Timeline |
| Under Armour C |
| H M Hennes |
Under Armour and H M Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Under Armour and H M
The main advantage of trading using opposite Under Armour and H M positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Under Armour position performs unexpectedly, H M 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 H M will offset losses from the drop in H M'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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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