Correlation Between Buckle and Genesco

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

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

Diversification Opportunities for Buckle and Genesco

0.86

Correlation Coefficient

Buckle  Genesco

Very poor diversification

The 3 months correlation between Buckle and Genesco is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Buckle Inc and Genesco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesco and Buckle 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 Buckle Inc are associated (or correlated) with Genesco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesco has no effect on the direction of Buckle i.e., Buckle and Genesco go up and down completely randomly.

Pair Corralation between Buckle and Genesco

Considering the 90-day investment horizon Buckle Inc is expected to generate 0.41 times more return on investment than Genesco. However, Buckle Inc is 2.47 times less risky than Genesco. It trades about -0.23 of its potential returns per unit of risk. Genesco is currently generating about -0.25 per unit of risk. If you would invest  4,841  in Buckle Inc on December 28, 2024 and sell it today you would lose (1,043) from holding Buckle Inc or give up 21.55% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Buckle Inc  vs.  Genesco

Buckle Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Buckle Inc 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 forward-looking signals remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Genesco

Risk-Adjusted Performance

Very Weak

Over the last 90 days Genesco has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Buckle and Genesco

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

The idea behind Buckle Inc and Genesco 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.