Correlation Between Hanesbrands and Cibc Atlas

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

By analyzing existing cross correlation between Hanesbrands and Cibc Atlas All, you can compare the effects of market volatilities on Hanesbrands and Cibc Atlas 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 Cibc Atlas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Cibc Atlas.

Diversification Opportunities for Hanesbrands and Cibc Atlas

0.33

Correlation Coefficient

Hanesbrands  Cibc Atlas

Weak diversification

The 3 months correlation between Hanesbrands and Cibc is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Cibc Atlas All in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cibc Atlas All 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 Cibc Atlas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cibc Atlas All has no effect on the direction of Hanesbrands i.e., Hanesbrands and Cibc Atlas go up and down completely randomly.

Pair Corralation between Hanesbrands and Cibc Atlas

Considering the 90-day investment horizon Hanesbrands is expected to generate 3.1 times more return on investment than Cibc Atlas. However, Hanesbrands is 3.1 times more volatile than Cibc Atlas All. It trades about 0.03 of its potential returns per unit of risk. Cibc Atlas All is currently generating about 0.08 per unit of risk. If you would invest  506.00  in Hanesbrands on December 2, 2024 and sell it today you would earn a total of  97.00  from holding Hanesbrands or generate 19.17% return on investment over 90 days.

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

Hanesbrands  vs.  Cibc Atlas All

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.

Cibc Atlas All

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cibc Atlas All has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Hanesbrands and Cibc Atlas

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

The idea behind Hanesbrands and Cibc Atlas All 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.