Correlation Between Hanesbrands and JuneYao Dairy

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

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

Diversification Opportunities for Hanesbrands and JuneYao Dairy

-0.4

Correlation Coefficient

Hanesbrands  JuneYao Dairy

Very good diversification

The 3 months correlation between Hanesbrands and JuneYao is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and JuneYao Dairy Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JuneYao Dairy and Hanesbrands 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 Hanesbrands are associated (or correlated) with JuneYao Dairy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JuneYao Dairy has no effect on the direction of Hanesbrands i.e., Hanesbrands and JuneYao Dairy go up and down completely randomly.

Pair Corralation between Hanesbrands and JuneYao Dairy

Considering the 90-day investment horizon Hanesbrands is expected to under-perform the JuneYao Dairy. In addition to that, Hanesbrands is 1.29 times more volatile than JuneYao Dairy Co. It trades about -0.16 of its total potential returns per unit of risk. JuneYao Dairy Co is currently generating about 0.02 per unit of volatility. If you would invest  632.00  in JuneYao Dairy Co on December 30, 2024 and sell it today you would earn a total of  10.00  from holding JuneYao Dairy Co or generate 1.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.16%
Values	Daily Returns

Hanesbrands  vs.  JuneYao Dairy Co

Hanesbrands

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hanesbrands has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental drivers remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

JuneYao Dairy

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in JuneYao Dairy Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, JuneYao Dairy is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Hanesbrands and JuneYao Dairy

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

The idea behind Hanesbrands and JuneYao Dairy Co 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.