Correlation Between Skechers USA and 694308KC0

Can any of the company-specific risk be diversified away by investing in both Skechers USA and 694308KC0 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 Skechers USA and 694308KC0 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Skechers USA and PCG 44 01 MAR 32, you can compare the effects of market volatilities on Skechers USA and 694308KC0 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 Skechers USA with a short position of 694308KC0. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skechers USA and 694308KC0.

Diversification Opportunities for Skechers USA and 694308KC0

0.05

Correlation Coefficient

Skechers USA  694308KC0

Significant diversification

The 3 months correlation between Skechers and 694308KC0 is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Skechers USA and PCG 44 01 MAR 32 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCG 44 01 and Skechers USA 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 Skechers USA are associated (or correlated) with 694308KC0. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PCG 44 01 has no effect on the direction of Skechers USA i.e., Skechers USA and 694308KC0 go up and down completely randomly.

Pair Corralation between Skechers USA and 694308KC0

Considering the 90-day investment horizon Skechers USA is expected to generate 1.04 times more return on investment than 694308KC0. However, Skechers USA is 1.04 times more volatile than PCG 44 01 MAR 32. It trades about -0.01 of its potential returns per unit of risk. PCG 44 01 MAR 32 is currently generating about -0.14 per unit of risk. If you would invest  6,923  in Skechers USA on September 26, 2024 and sell it today you would lose (197.00) from holding Skechers USA or give up 2.85% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	79.37%
Values	Daily Returns

Skechers USA  vs.  PCG 44 01 MAR 32

Skechers USA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Skechers USA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong forward-looking signals, Skechers USA is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

PCG 44 01

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PCG 44 01 MAR 32 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for PCG 44 01 MAR 32 investors.

Pair Trading with Skechers USA and 694308KC0

The main advantage of trading using opposite Skechers USA and 694308KC0 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Skechers USA position performs unexpectedly, 694308KC0 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 694308KC0 will offset losses from the drop in 694308KC0's long position.

The idea behind Skechers USA and PCG 44 01 MAR 32 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.