Correlation Between Burlington Stores and SOGECLAIR

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

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

Diversification Opportunities for Burlington Stores and SOGECLAIR

-0.71

Correlation Coefficient

Burlington Stores  SOGECLAIR

Pay attention - limited upside

The 3 months correlation between Burlington and SOGECLAIR is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Burlington Stores and SOGECLAIR SA INH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOGECLAIR SA INH and Burlington Stores 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 Burlington Stores are associated (or correlated) with SOGECLAIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOGECLAIR SA INH has no effect on the direction of Burlington Stores i.e., Burlington Stores and SOGECLAIR go up and down completely randomly.

Pair Corralation between Burlington Stores and SOGECLAIR

Assuming the 90 days trading horizon Burlington Stores is expected to under-perform the SOGECLAIR. But the stock apears to be less risky and, when comparing its historical volatility, Burlington Stores is 1.44 times less risky than SOGECLAIR. The stock trades about -0.14 of its potential returns per unit of risk. The SOGECLAIR SA INH is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  1,720  in SOGECLAIR SA INH on December 25, 2024 and sell it today you would earn a total of  810.00  from holding SOGECLAIR SA INH or generate 47.09% return on investment over 90 days.

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

Burlington Stores  vs.  SOGECLAIR SA INH

Burlington Stores

Risk-Adjusted Performance

Very Weak

Over the last 90 days Burlington Stores has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

SOGECLAIR SA INH

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SOGECLAIR SA INH are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SOGECLAIR reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Burlington Stores and SOGECLAIR

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

The idea behind Burlington Stores and SOGECLAIR SA INH 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.

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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.