Correlation Between URBAN OUTFITTERS and NISSHA
Can any of the company-specific risk be diversified away by investing in both URBAN OUTFITTERS and NISSHA 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 URBAN OUTFITTERS and NISSHA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between URBAN OUTFITTERS and NISSHA LTD, you can compare the effects of market volatilities on URBAN OUTFITTERS and NISSHA 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 URBAN OUTFITTERS with a short position of NISSHA. Check out your portfolio center. Please also check ongoing floating volatility patterns of URBAN OUTFITTERS and NISSHA.
Diversification Opportunities for URBAN OUTFITTERS and NISSHA
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between URBAN and NISSHA is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding URBAN OUTFITTERS and NISSHA LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NISSHA LTD and URBAN OUTFITTERS 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 URBAN OUTFITTERS are associated (or correlated) with NISSHA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NISSHA LTD has no effect on the direction of URBAN OUTFITTERS i.e., URBAN OUTFITTERS and NISSHA go up and down completely randomly.
Pair Corralation between URBAN OUTFITTERS and NISSHA
Assuming the 90 days trading horizon URBAN OUTFITTERS is expected to generate 1.17 times more return on investment than NISSHA. However, URBAN OUTFITTERS is 1.17 times more volatile than NISSHA LTD. It trades about 0.06 of its potential returns per unit of risk. NISSHA LTD is currently generating about 0.02 per unit of risk. If you would invest 3,400 in URBAN OUTFITTERS on September 12, 2024 and sell it today you would earn a total of 1,380 from holding URBAN OUTFITTERS or generate 40.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
URBAN OUTFITTERS vs. NISSHA LTD
Performance |
| Timeline |
| URBAN OUTFITTERS |
| NISSHA LTD |
URBAN OUTFITTERS and NISSHA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with URBAN OUTFITTERS and NISSHA
The main advantage of trading using opposite URBAN OUTFITTERS and NISSHA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if URBAN OUTFITTERS position performs unexpectedly, NISSHA 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 NISSHA will offset losses from the drop in NISSHA's long position.| URBAN OUTFITTERS vs. Apple Inc | URBAN OUTFITTERS vs. Apple Inc | URBAN OUTFITTERS vs. Apple Inc | URBAN OUTFITTERS vs. Apple Inc |
| NISSHA vs. Constellation Software | NISSHA vs. URBAN OUTFITTERS | NISSHA vs. Astral Foods Limited | NISSHA vs. Thai Beverage Public |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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