Correlation Between Ermenegildo Zegna and Xcel Brands
Can any of the company-specific risk be diversified away by investing in both Ermenegildo Zegna and Xcel Brands 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 Xcel Brands 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 Xcel Brands, you can compare the effects of market volatilities on Ermenegildo Zegna and Xcel Brands 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 Xcel Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ermenegildo Zegna and Xcel Brands.
Diversification Opportunities for Ermenegildo Zegna and Xcel Brands
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ermenegildo and Xcel is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Ermenegildo Zegna NV and Xcel Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xcel Brands 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 Xcel Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xcel Brands has no effect on the direction of Ermenegildo Zegna i.e., Ermenegildo Zegna and Xcel Brands go up and down completely randomly.
Pair Corralation between Ermenegildo Zegna and Xcel Brands
Considering the 90-day investment horizon Ermenegildo Zegna NV is expected to generate 0.3 times more return on investment than Xcel Brands. However, Ermenegildo Zegna NV is 3.33 times less risky than Xcel Brands. It trades about 0.13 of its potential returns per unit of risk. Xcel Brands is currently generating about -0.09 per unit of risk. If you would invest 747.00 in Ermenegildo Zegna NV on November 8, 2024 and sell it today you would earn a total of 150.00 from holding Ermenegildo Zegna NV or generate 20.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ermenegildo Zegna NV vs. Xcel Brands
Performance |
| Timeline |
| Ermenegildo Zegna |
| Xcel Brands |
Ermenegildo Zegna and Xcel Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ermenegildo Zegna and Xcel Brands
The main advantage of trading using opposite Ermenegildo Zegna and Xcel Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ermenegildo Zegna position performs unexpectedly, Xcel Brands 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 Xcel Brands will offset losses from the drop in Xcel Brands' long position.| Ermenegildo Zegna vs. Oxford Industries | Ermenegildo Zegna vs. G III Apparel Group | Ermenegildo Zegna vs. Kontoor Brands | Ermenegildo Zegna vs. Columbia Sportswear |
| Xcel Brands vs. H M Hennes | Xcel Brands vs. Under Armour C | Xcel Brands vs. H M Hennes | Xcel Brands vs. Oxford Industries |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |