Correlation Between Ermenegildo Zegna and RYU Apparel
Can any of the company-specific risk be diversified away by investing in both Ermenegildo Zegna and RYU Apparel 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 Ermenegildo Zegna and RYU Apparel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ermenegildo Zegna NV and RYU Apparel, you can compare the effects of market volatilities on Ermenegildo Zegna and RYU Apparel 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 Ermenegildo Zegna with a short position of RYU Apparel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ermenegildo Zegna and RYU Apparel.
Diversification Opportunities for Ermenegildo Zegna and RYU Apparel
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ermenegildo and RYU is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Ermenegildo Zegna NV and RYU Apparel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RYU Apparel and Ermenegildo Zegna 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 Ermenegildo Zegna NV are associated (or correlated) with RYU Apparel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RYU Apparel has no effect on the direction of Ermenegildo Zegna i.e., Ermenegildo Zegna and RYU Apparel go up and down completely randomly.
Pair Corralation between Ermenegildo Zegna and RYU Apparel
Considering the 90-day investment horizon Ermenegildo Zegna NV is expected to generate 0.11 times more return on investment than RYU Apparel. However, Ermenegildo Zegna NV is 8.83 times less risky than RYU Apparel. It trades about -0.01 of its potential returns per unit of risk. RYU Apparel is currently generating about -0.01 per unit of risk. If you would invest 1,202 in Ermenegildo Zegna NV on November 1, 2024 and sell it today you would lose (282.00) from holding Ermenegildo Zegna NV or give up 23.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 8.11% |
| Values | Daily Returns |
Ermenegildo Zegna NV vs. RYU Apparel
Performance |
| Timeline |
| Ermenegildo Zegna |
| RYU Apparel |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ermenegildo Zegna and RYU Apparel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ermenegildo Zegna and RYU Apparel
The main advantage of trading using opposite Ermenegildo Zegna and RYU Apparel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ermenegildo Zegna position performs unexpectedly, RYU Apparel 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 RYU Apparel will offset losses from the drop in RYU Apparel's long position.| Ermenegildo Zegna vs. Oxford Industries | Ermenegildo Zegna vs. G III Apparel Group | Ermenegildo Zegna vs. Kontoor Brands | Ermenegildo Zegna vs. Columbia Sportswear |
| RYU Apparel vs. H M Hennes | RYU Apparel vs. Xcel Brands | RYU Apparel vs. Oxford Industries | RYU Apparel vs. H M Hennes |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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