Correlation Between URBAN OUTFITTERS and AM EAGLE
Can any of the company-specific risk be diversified away by investing in both URBAN OUTFITTERS and AM EAGLE 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 AM EAGLE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between URBAN OUTFITTERS and AM EAGLE OUTFITTERS, you can compare the effects of market volatilities on URBAN OUTFITTERS and AM EAGLE 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 AM EAGLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of URBAN OUTFITTERS and AM EAGLE.
Diversification Opportunities for URBAN OUTFITTERS and AM EAGLE
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between URBAN and AFG is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding URBAN OUTFITTERS and AM EAGLE OUTFITTERS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AM EAGLE OUTFITTERS 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 AM EAGLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AM EAGLE OUTFITTERS has no effect on the direction of URBAN OUTFITTERS i.e., URBAN OUTFITTERS and AM EAGLE go up and down completely randomly.
Pair Corralation between URBAN OUTFITTERS and AM EAGLE
Assuming the 90 days trading horizon URBAN OUTFITTERS is expected to generate 1.37 times more return on investment than AM EAGLE. However, URBAN OUTFITTERS is 1.37 times more volatile than AM EAGLE OUTFITTERS. It trades about 0.17 of its potential returns per unit of risk. AM EAGLE OUTFITTERS is currently generating about 0.0 per unit of risk. If you would invest 3,260 in URBAN OUTFITTERS on September 2, 2024 and sell it today you would earn a total of 1,220 from holding URBAN OUTFITTERS or generate 37.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
URBAN OUTFITTERS vs. AM EAGLE OUTFITTERS
Performance |
| Timeline |
| URBAN OUTFITTERS |
| AM EAGLE OUTFITTERS |
URBAN OUTFITTERS and AM EAGLE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with URBAN OUTFITTERS and AM EAGLE
The main advantage of trading using opposite URBAN OUTFITTERS and AM EAGLE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if URBAN OUTFITTERS position performs unexpectedly, AM EAGLE 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 AM EAGLE will offset losses from the drop in AM EAGLE's long position.| URBAN OUTFITTERS vs. SIVERS SEMICONDUCTORS AB | URBAN OUTFITTERS vs. Darden Restaurants | URBAN OUTFITTERS vs. Reliance Steel Aluminum | URBAN OUTFITTERS vs. Q2M Managementberatung AG |
| AM EAGLE vs. SIVERS SEMICONDUCTORS AB | AM EAGLE vs. Darden Restaurants | AM EAGLE vs. Reliance Steel Aluminum | AM EAGLE vs. Q2M Managementberatung AG |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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