Correlation Between ANTA Sports and TAKIX

Can any of the company-specific risk be diversified away by investing in both ANTA Sports and TAKIX 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 ANTA Sports and TAKIX into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ANTA Sports Products and TAKIX, you can compare the effects of market volatilities on ANTA Sports and TAKIX 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 ANTA Sports with a short position of TAKIX. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANTA Sports and TAKIX.

Diversification Opportunities for ANTA Sports and TAKIX

0.3

Correlation Coefficient

ANTA Sports  TAKIX

Weak diversification

The 3 months correlation between ANTA and TAKIX is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding ANTA Sports Products and TAKIX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TAKIX and ANTA Sports 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 ANTA Sports Products are associated (or correlated) with TAKIX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TAKIX has no effect on the direction of ANTA Sports i.e., ANTA Sports and TAKIX go up and down completely randomly.

Pair Corralation between ANTA Sports and TAKIX

Assuming the 90 days horizon ANTA Sports Products is expected to under-perform the TAKIX. In addition to that, ANTA Sports is 40.89 times more volatile than TAKIX. It trades about -0.26 of its total potential returns per unit of risk. TAKIX is currently generating about -0.41 per unit of volatility. If you would invest  858.00  in TAKIX on October 11, 2024 and sell it today you would lose (3.00) from holding TAKIX or give up 0.35% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

ANTA Sports Products  vs.  TAKIX

ANTA Sports Products

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ANTA Sports Products has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

TAKIX

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TAKIX has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong forward indicators, TAKIX is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with ANTA Sports and TAKIX

The main advantage of trading using opposite ANTA Sports and TAKIX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANTA Sports position performs unexpectedly, TAKIX 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 TAKIX will offset losses from the drop in TAKIX's long position.

The idea behind ANTA Sports Products and TAKIX pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.