Correlation Between Tillys and Lands End

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

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

Diversification Opportunities for Tillys and Lands End

-0.04

Correlation Coefficient

Tillys  Lands End

Good diversification

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

Pair Corralation between Tillys and Lands End

Given the investment horizon of 90 days Tillys Inc is expected to under-perform the Lands End. In addition to that, Tillys is 1.16 times more volatile than Lands End. It trades about -0.08 of its total potential returns per unit of risk. Lands End is currently generating about 0.02 per unit of volatility. If you would invest  1,549  in Lands End on August 30, 2024 and sell it today you would lose (5.00) from holding Lands End or give up 0.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Tillys Inc  vs.  Lands End

Tillys Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tillys Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Lands End

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Lands End are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Lands End is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Tillys and Lands End

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

The idea behind Tillys Inc and Lands End 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.