Correlation Between Ermenegildo Zegna and Superior Uniform
Can any of the company-specific risk be diversified away by investing in both Ermenegildo Zegna and Superior Uniform 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 Superior Uniform 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 Superior Uniform Group, you can compare the effects of market volatilities on Ermenegildo Zegna and Superior Uniform 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 Superior Uniform. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ermenegildo Zegna and Superior Uniform.
Diversification Opportunities for Ermenegildo Zegna and Superior Uniform
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ermenegildo and Superior is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Ermenegildo Zegna NV and Superior Uniform Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Uniform 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 Superior Uniform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Uniform has no effect on the direction of Ermenegildo Zegna i.e., Ermenegildo Zegna and Superior Uniform go up and down completely randomly.
Pair Corralation between Ermenegildo Zegna and Superior Uniform
Considering the 90-day investment horizon Ermenegildo Zegna NV is expected to under-perform the Superior Uniform. But the stock apears to be less risky and, when comparing its historical volatility, Ermenegildo Zegna NV is 1.14 times less risky than Superior Uniform. The stock trades about -0.08 of its potential returns per unit of risk. The Superior Uniform Group is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,468 in Superior Uniform Group on August 25, 2024 and sell it today you would earn a total of 196.00 from holding Superior Uniform Group or generate 13.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ermenegildo Zegna NV vs. Superior Uniform Group
Performance |
| Timeline |
| Ermenegildo Zegna |
| Superior Uniform |
Ermenegildo Zegna and Superior Uniform Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ermenegildo Zegna and Superior Uniform
The main advantage of trading using opposite Ermenegildo Zegna and Superior Uniform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ermenegildo Zegna position performs unexpectedly, Superior Uniform 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 Superior Uniform will offset losses from the drop in Superior Uniform'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 |
| Superior Uniform vs. Lakeland Industries | Superior Uniform vs. Jerash Holdings | Superior Uniform vs. G III Apparel Group | Superior Uniform vs. JX Luxventure Limited |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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