Correlation Between Urban Outfitters and SIVERS SEMICONDUCTORS

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

By analyzing existing cross correlation between Urban Outfitters and SIVERS SEMICONDUCTORS AB, you can compare the effects of market volatilities on Urban Outfitters and SIVERS SEMICONDUCTORS 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 Urban Outfitters with a short position of SIVERS SEMICONDUCTORS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Urban Outfitters and SIVERS SEMICONDUCTORS.

Diversification Opportunities for Urban Outfitters and SIVERS SEMICONDUCTORS

-0.12

Correlation Coefficient

Urban Outfitters  SIVERS SEMICONDUCTORS

Good diversification

The 3 months correlation between Urban and SIVERS is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Urban Outfitters and SIVERS SEMICONDUCTORS AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIVERS SEMICONDUCTORS and Urban Outfitters 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 Urban Outfitters are associated (or correlated) with SIVERS SEMICONDUCTORS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIVERS SEMICONDUCTORS has no effect on the direction of Urban Outfitters i.e., Urban Outfitters and SIVERS SEMICONDUCTORS go up and down completely randomly.

Pair Corralation between Urban Outfitters and SIVERS SEMICONDUCTORS

Assuming the 90 days horizon Urban Outfitters is expected to generate 0.46 times more return on investment than SIVERS SEMICONDUCTORS. However, Urban Outfitters is 2.17 times less risky than SIVERS SEMICONDUCTORS. It trades about 0.08 of its potential returns per unit of risk. SIVERS SEMICONDUCTORS AB is currently generating about 0.0 per unit of risk. If you would invest  2,538  in Urban Outfitters on October 24, 2024 and sell it today you would earn a total of  3,312  from holding Urban Outfitters or generate 130.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Urban Outfitters  vs.  SIVERS SEMICONDUCTORS AB

Urban Outfitters

Risk-Adjusted Performance

26 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Urban Outfitters are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Urban Outfitters reported solid returns over the last few months and may actually be approaching a breakup point.

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SIVERS SEMICONDUCTORS AB are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SIVERS SEMICONDUCTORS reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Urban Outfitters and SIVERS SEMICONDUCTORS

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

The idea behind Urban Outfitters and SIVERS SEMICONDUCTORS AB 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.

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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.