Correlation Between Under Armour and Getty Copper
Can any of the company-specific risk be diversified away by investing in both Under Armour and Getty Copper 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 Under Armour and Getty Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Under Armour C and Getty Copper, you can compare the effects of market volatilities on Under Armour and Getty Copper 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 Under Armour with a short position of Getty Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Under Armour and Getty Copper.
Diversification Opportunities for Under Armour and Getty Copper
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Under and Getty is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Under Armour C and Getty Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Copper and Under Armour 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 Under Armour C are associated (or correlated) with Getty Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Copper has no effect on the direction of Under Armour i.e., Under Armour and Getty Copper go up and down completely randomly.
Pair Corralation between Under Armour and Getty Copper
Allowing for the 90-day total investment horizon Under Armour C is expected to generate 0.66 times more return on investment than Getty Copper. However, Under Armour C is 1.51 times less risky than Getty Copper. It trades about -0.03 of its potential returns per unit of risk. Getty Copper is currently generating about -0.09 per unit of risk. If you would invest 750.00 in Under Armour C on December 5, 2024 and sell it today you would lose (123.00) from holding Under Armour C or give up 16.4% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 96.85% |
Values | Daily Returns |
Under Armour C vs. Getty Copper
Performance |
Timeline |
Under Armour C |
Getty Copper |
Under Armour and Getty Copper Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Under Armour and Getty Copper
The main advantage of trading using opposite Under Armour and Getty Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Under Armour position performs unexpectedly, Getty Copper 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 Getty Copper will offset losses from the drop in Getty Copper's long position.Under Armour vs. Levi Strauss Co | Under Armour vs. Columbia Sportswear | Under Armour vs. Hanesbrands | Under Armour vs. PVH Corp |
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Check out your portfolio center.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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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