Correlation Between Under Armour and AETNA
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By analyzing existing cross correlation between Under Armour C and AETNA INC NEW, you can compare the effects of market volatilities on Under Armour and AETNA 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 AETNA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Under Armour and AETNA.
Diversification Opportunities for Under Armour and AETNA
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Under and AETNA is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Under Armour C and AETNA INC NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AETNA INC NEW 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 AETNA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AETNA INC NEW has no effect on the direction of Under Armour i.e., Under Armour and AETNA go up and down completely randomly.
Pair Corralation between Under Armour and AETNA
Allowing for the 90-day total investment horizon Under Armour C is expected to generate 19.1 times more return on investment than AETNA. However, Under Armour is 19.1 times more volatile than AETNA INC NEW. It trades about 0.1 of its potential returns per unit of risk. AETNA INC NEW is currently generating about -0.25 per unit of risk. If you would invest 801.00 in Under Armour C on August 31, 2024 and sell it today you would earn a total of 76.00 from holding Under Armour C or generate 9.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 45.45% |
| Values | Daily Returns |
Under Armour C vs. AETNA INC NEW
Performance |
| Timeline |
| Under Armour C |
| AETNA INC NEW |
Under Armour and AETNA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Under Armour and AETNA
The main advantage of trading using opposite Under Armour and AETNA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Under Armour position performs unexpectedly, AETNA 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 AETNA will offset losses from the drop in AETNA'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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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