Correlation Between 1 800 and Macys

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Can any of the company-specific risk be diversified away by investing in both 1 800 and Macys 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 1 800 and Macys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1 800 FLOWERSCOM and Macys Inc, you can compare the effects of market volatilities on 1 800 and Macys 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 1 800 with a short position of Macys. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1 800 and Macys.

Diversification Opportunities for 1 800 and Macys

-0.04
  Correlation Coefficient

Good diversification

The 3 months correlation between FLWS and Macys is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding 1 800 FLOWERSCOM and Macys Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macys Inc and 1 800 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 1 800 FLOWERSCOM are associated (or correlated) with Macys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macys Inc has no effect on the direction of 1 800 i.e., 1 800 and Macys go up and down completely randomly.

Pair Corralation between 1 800 and Macys

Given the investment horizon of 90 days 1 800 FLOWERSCOM is expected to under-perform the Macys. In addition to that, 1 800 is 1.04 times more volatile than Macys Inc. It trades about -0.04 of its total potential returns per unit of risk. Macys Inc is currently generating about 0.0 per unit of volatility. If you would invest  1,784  in Macys Inc on September 27, 2024 and sell it today you would lose (102.00) from holding Macys Inc or give up 5.72% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

1 800 FLOWERSCOM  vs.  Macys Inc

 Performance 
       Timeline  
1 800 FLOWERSCOM 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days 1 800 FLOWERSCOM has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, 1 800 is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.
Macys Inc 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Macys Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady primary indicators, Macys may actually be approaching a critical reversion point that can send shares even higher in January 2025.

1 800 and Macys Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with 1 800 and Macys

The main advantage of trading using opposite 1 800 and Macys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1 800 position performs unexpectedly, Macys 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 Macys will offset losses from the drop in Macys' long position.
The idea behind 1 800 FLOWERSCOM and Macys Inc 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.

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