Correlation Between Vera Bradley and Mannatech Incorporated
Can any of the company-specific risk be diversified away by investing in both Vera Bradley and Mannatech Incorporated 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 Vera Bradley and Mannatech Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vera Bradley and Mannatech Incorporated, you can compare the effects of market volatilities on Vera Bradley and Mannatech Incorporated 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 Vera Bradley with a short position of Mannatech Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vera Bradley and Mannatech Incorporated.
Diversification Opportunities for Vera Bradley and Mannatech Incorporated
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vera and Mannatech is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Vera Bradley and Mannatech Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mannatech Incorporated and Vera Bradley 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 Vera Bradley are associated (or correlated) with Mannatech Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mannatech Incorporated has no effect on the direction of Vera Bradley i.e., Vera Bradley and Mannatech Incorporated go up and down completely randomly.
Pair Corralation between Vera Bradley and Mannatech Incorporated
Considering the 90-day investment horizon Vera Bradley is expected to generate 0.48 times more return on investment than Mannatech Incorporated. However, Vera Bradley is 2.06 times less risky than Mannatech Incorporated. It trades about 0.1 of its potential returns per unit of risk. Mannatech Incorporated is currently generating about -0.03 per unit of risk. If you would invest 533.00 in Vera Bradley on August 28, 2024 and sell it today you would earn a total of 25.00 from holding Vera Bradley or generate 4.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Vera Bradley vs. Mannatech Incorporated
Performance |
| Timeline |
| Vera Bradley |
| Mannatech Incorporated |
Vera Bradley and Mannatech Incorporated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vera Bradley and Mannatech Incorporated
The main advantage of trading using opposite Vera Bradley and Mannatech Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vera Bradley position performs unexpectedly, Mannatech Incorporated 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 Mannatech Incorporated will offset losses from the drop in Mannatech Incorporated's long position.| Vera Bradley vs. Rocky Brands | Vera Bradley vs. Steven Madden | Vera Bradley vs. Wolverine World Wide | Vera Bradley vs. Caleres |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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