Correlation Between Under Armour and Oxford Industries
Can any of the company-specific risk be diversified away by investing in both Under Armour and Oxford Industries 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 Oxford Industries 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 Oxford Industries, you can compare the effects of market volatilities on Under Armour and Oxford Industries 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 Oxford Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Under Armour and Oxford Industries.
Diversification Opportunities for Under Armour and Oxford Industries
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Under and Oxford is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Under Armour C and Oxford Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oxford Industries 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 Oxford Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oxford Industries has no effect on the direction of Under Armour i.e., Under Armour and Oxford Industries go up and down completely randomly.
Pair Corralation between Under Armour and Oxford Industries
Allowing for the 90-day total investment horizon Under Armour C is expected to generate 1.36 times more return on investment than Oxford Industries. However, Under Armour is 1.36 times more volatile than Oxford Industries. It trades about 0.01 of its potential returns per unit of risk. Oxford Industries is currently generating about -0.03 per unit of risk. If you would invest 888.00 in Under Armour C on August 23, 2024 and sell it today you would lose (45.00) from holding Under Armour C or give up 5.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Under Armour C vs. Oxford Industries
Performance |
| Timeline |
| Under Armour C |
| Oxford Industries |
Under Armour and Oxford Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Under Armour and Oxford Industries
The main advantage of trading using opposite Under Armour and Oxford Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Under Armour position performs unexpectedly, Oxford Industries 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 Oxford Industries will offset losses from the drop in Oxford Industries' long position.| Under Armour vs. Levi Strauss Co | Under Armour vs. Columbia Sportswear | Under Armour vs. Hanesbrands | Under Armour vs. PVH Corp |
| Oxford Industries vs. Columbia Sportswear | Oxford Industries vs. Levi Strauss Co | Oxford Industries vs. Hanesbrands | Oxford Industries vs. Under Armour C |
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.
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