Correlation Between Vision Marine and Hanesbrands
Can any of the company-specific risk be diversified away by investing in both Vision Marine and Hanesbrands 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 Vision Marine and Hanesbrands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vision Marine Technologies and Hanesbrands, you can compare the effects of market volatilities on Vision Marine and Hanesbrands 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 Vision Marine with a short position of Hanesbrands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vision Marine and Hanesbrands.
Diversification Opportunities for Vision Marine and Hanesbrands
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Vision and Hanesbrands is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Vision Marine Technologies and Hanesbrands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanesbrands and Vision Marine 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 Vision Marine Technologies are associated (or correlated) with Hanesbrands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanesbrands has no effect on the direction of Vision Marine i.e., Vision Marine and Hanesbrands go up and down completely randomly.
Pair Corralation between Vision Marine and Hanesbrands
Given the investment horizon of 90 days Vision Marine Technologies is expected to under-perform the Hanesbrands. In addition to that, Vision Marine is 2.68 times more volatile than Hanesbrands. It trades about -0.13 of its total potential returns per unit of risk. Hanesbrands is currently generating about 0.1 per unit of volatility. If you would invest 429.00 in Hanesbrands on October 20, 2024 and sell it today you would earn a total of 400.00 from holding Hanesbrands or generate 93.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vision Marine Technologies vs. Hanesbrands
Performance |
| Timeline |
| Vision Marine Techno |
| Hanesbrands |
Vision Marine and Hanesbrands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vision Marine and Hanesbrands
The main advantage of trading using opposite Vision Marine and Hanesbrands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vision Marine position performs unexpectedly, Hanesbrands 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 Hanesbrands will offset losses from the drop in Hanesbrands' long position.| Vision Marine vs. Amer Sports, | Vision Marine vs. Brunswick | Vision Marine vs. Ralph Lauren Corp | Vision Marine vs. Under Armour C |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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