Correlation Between Vince Holding and Biglari Holdings
Can any of the company-specific risk be diversified away by investing in both Vince Holding and Biglari Holdings 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 Vince Holding and Biglari Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vince Holding Corp and Biglari Holdings, you can compare the effects of market volatilities on Vince Holding and Biglari Holdings 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 Vince Holding with a short position of Biglari Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vince Holding and Biglari Holdings.
Diversification Opportunities for Vince Holding and Biglari Holdings
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vince and Biglari is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Vince Holding Corp and Biglari Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biglari Holdings and Vince Holding 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 Vince Holding Corp are associated (or correlated) with Biglari Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biglari Holdings has no effect on the direction of Vince Holding i.e., Vince Holding and Biglari Holdings go up and down completely randomly.
Pair Corralation between Vince Holding and Biglari Holdings
Given the investment horizon of 90 days Vince Holding Corp is expected to generate 2.99 times more return on investment than Biglari Holdings. However, Vince Holding is 2.99 times more volatile than Biglari Holdings. It trades about 0.05 of its potential returns per unit of risk. Biglari Holdings is currently generating about 0.07 per unit of risk. If you would invest 129.00 in Vince Holding Corp on August 27, 2024 and sell it today you would earn a total of 41.00 from holding Vince Holding Corp or generate 31.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vince Holding Corp vs. Biglari Holdings
Performance |
| Timeline |
| Vince Holding Corp |
| Biglari Holdings |
Vince Holding and Biglari Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vince Holding and Biglari Holdings
The main advantage of trading using opposite Vince Holding and Biglari Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vince Holding position performs unexpectedly, Biglari Holdings 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 Biglari Holdings will offset losses from the drop in Biglari Holdings' long position.| Vince Holding vs. VF Corporation | Vince Holding vs. Levi Strauss Co | Vince Holding vs. Under Armour A | Vince Holding vs. Oxford Industries |
| Biglari Holdings vs. Cannae Holdings | Biglari Holdings vs. BJs Restaurants | Biglari Holdings vs. Ark Restaurants Corp | Biglari Holdings vs. Noble Romans |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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