Correlation Between Burlington Stores and SSP Group

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

By analyzing existing cross correlation between Burlington Stores and SSP Group PLC, you can compare the effects of market volatilities on Burlington Stores and SSP Group 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 SSP Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burlington Stores and SSP Group.

Diversification Opportunities for Burlington Stores and SSP Group

0.0

Correlation Coefficient

Burlington Stores  SSP Group

Pay attention - limited upside

The 3 months correlation between Burlington and SSP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Burlington Stores and SSP Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSP Group PLC 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 SSP Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSP Group PLC has no effect on the direction of Burlington Stores i.e., Burlington Stores and SSP Group go up and down completely randomly.

Pair Corralation between Burlington Stores and SSP Group

If you would invest  24,000  in Burlington Stores on October 6, 2024 and sell it today you would earn a total of  3,600  from holding Burlington Stores or generate 15.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.67%
Values	Daily Returns

Burlington Stores  vs.  SSP Group PLC

Burlington Stores

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Burlington Stores are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Burlington Stores unveiled solid returns over the last few months and may actually be approaching a breakup point.

SSP Group PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SSP Group PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, SSP Group is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Burlington Stores and SSP Group

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

The idea behind Burlington Stores and SSP Group PLC 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 Stocks Directory module to find actively traded stocks across global markets.