Correlation Between Xcel Brands and Under Armour
Can any of the company-specific risk be diversified away by investing in both Xcel Brands and Under Armour 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 Xcel Brands and Under Armour into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xcel Brands and Under Armour C, you can compare the effects of market volatilities on Xcel Brands and Under Armour 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 Xcel Brands with a short position of Under Armour. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xcel Brands and Under Armour.
Diversification Opportunities for Xcel Brands and Under Armour
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Xcel and Under is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Xcel Brands and Under Armour C in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Under Armour C and Xcel Brands 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 Xcel Brands are associated (or correlated) with Under Armour. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Under Armour C has no effect on the direction of Xcel Brands i.e., Xcel Brands and Under Armour go up and down completely randomly.
Pair Corralation between Xcel Brands and Under Armour
Given the investment horizon of 90 days Xcel Brands is expected to generate 5.77 times less return on investment than Under Armour. But when comparing it to its historical volatility, Xcel Brands is 1.58 times less risky than Under Armour. It trades about 0.02 of its potential returns per unit of risk. Under Armour C is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 747.00 in Under Armour C on August 29, 2024 and sell it today you would earn a total of 130.00 from holding Under Armour C or generate 17.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xcel Brands vs. Under Armour C
Performance |
| Timeline |
| Xcel Brands |
| Under Armour C |
Xcel Brands and Under Armour Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xcel Brands and Under Armour
The main advantage of trading using opposite Xcel Brands and Under Armour positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xcel Brands position performs unexpectedly, Under Armour 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 Under Armour will offset losses from the drop in Under Armour's long position.| Xcel Brands vs. H M Hennes | Xcel Brands vs. Under Armour C | Xcel Brands vs. H M Hennes | Xcel Brands vs. Oxford Industries |
| Under Armour vs. Levi Strauss Co | Under Armour vs. Columbia Sportswear | Under Armour vs. Hanesbrands | Under Armour vs. PVH Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Stocks Directory Find actively traded stocks across global markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |