Correlation Between Superior Uniform and G III

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

By analyzing existing cross correlation between Superior Uniform Group and G III Apparel Group, you can compare the effects of market volatilities on Superior Uniform and G III 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 Superior Uniform with a short position of G III. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Uniform and G III.

Diversification Opportunities for Superior Uniform and G III

0.26

Correlation Coefficient

Superior Uniform  G III

Modest diversification

The 3 months correlation between Superior and GIII is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Superior Uniform Group and G III Apparel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G III Apparel and Superior Uniform 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 Superior Uniform Group are associated (or correlated) with G III. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G III Apparel has no effect on the direction of Superior Uniform i.e., Superior Uniform and G III go up and down completely randomly.

Pair Corralation between Superior Uniform and G III

Considering the 90-day investment horizon Superior Uniform Group is expected to generate 0.58 times more return on investment than G III. However, Superior Uniform Group is 1.74 times less risky than G III. It trades about 0.13 of its potential returns per unit of risk. G III Apparel Group is currently generating about 0.07 per unit of risk. If you would invest  1,436  in Superior Uniform Group on August 30, 2024 and sell it today you would earn a total of  253.00  from holding Superior Uniform Group or generate 17.62% return on investment over 90 days.

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

Superior Uniform Group  vs.  G III Apparel Group

Superior Uniform

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Superior Uniform Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Superior Uniform exhibited solid returns over the last few months and may actually be approaching a breakup point.

G III Apparel

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in G III Apparel Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating forward indicators, G III demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Superior Uniform and G III

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

The idea behind Superior Uniform Group and G III Apparel Group 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.