Correlation Between Winnebago Industries and Columbia Sportswear
Can any of the company-specific risk be diversified away by investing in both Winnebago Industries and Columbia Sportswear 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 Winnebago Industries and Columbia Sportswear into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Winnebago Industries and Columbia Sportswear, you can compare the effects of market volatilities on Winnebago Industries and Columbia Sportswear 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 Winnebago Industries with a short position of Columbia Sportswear. Check out your portfolio center. Please also check ongoing floating volatility patterns of Winnebago Industries and Columbia Sportswear.
Diversification Opportunities for Winnebago Industries and Columbia Sportswear
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Winnebago and Columbia is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Winnebago Industries and Columbia Sportswear in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Sportswear and Winnebago Industries 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 Winnebago Industries are associated (or correlated) with Columbia Sportswear. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Sportswear has no effect on the direction of Winnebago Industries i.e., Winnebago Industries and Columbia Sportswear go up and down completely randomly.
Pair Corralation between Winnebago Industries and Columbia Sportswear
Assuming the 90 days horizon Winnebago Industries is expected to generate 3.55 times less return on investment than Columbia Sportswear. In addition to that, Winnebago Industries is 2.18 times more volatile than Columbia Sportswear. It trades about 0.03 of its total potential returns per unit of risk. Columbia Sportswear is currently generating about 0.27 per unit of volatility. If you would invest 8,050 in Columbia Sportswear on November 1, 2024 and sell it today you would earn a total of 500.00 from holding Columbia Sportswear or generate 6.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Winnebago Industries vs. Columbia Sportswear
Performance |
| Timeline |
| Winnebago Industries |
| Columbia Sportswear |
Winnebago Industries and Columbia Sportswear Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Winnebago Industries and Columbia Sportswear
The main advantage of trading using opposite Winnebago Industries and Columbia Sportswear positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Winnebago Industries position performs unexpectedly, Columbia Sportswear 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 Columbia Sportswear will offset losses from the drop in Columbia Sportswear's long position.| Winnebago Industries vs. PLAYMATES TOYS | Winnebago Industries vs. 24SEVENOFFICE GROUP AB | Winnebago Industries vs. Playa Hotels Resorts | Winnebago Industries vs. TRAVEL LEISURE DL 01 |
| Columbia Sportswear vs. PROSIEBENSAT1 MEDIADR4 | Columbia Sportswear vs. CODERE ONLINE LUX | Columbia Sportswear vs. BOS BETTER ONLINE | Columbia Sportswear vs. Townsquare Media |
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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