Correlation Between Zumiez and 06050WHM0

Can any of the company-specific risk be diversified away by investing in both Zumiez and 06050WHM0 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 Zumiez and 06050WHM0 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Zumiez Inc and US06050WHM01, you can compare the effects of market volatilities on Zumiez and 06050WHM0 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 Zumiez with a short position of 06050WHM0. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zumiez and 06050WHM0.

Diversification Opportunities for Zumiez and 06050WHM0

0.0

Correlation Coefficient

Zumiez  06050WHM0

Pay attention - limited upside

The 3 months correlation between Zumiez and 06050WHM0 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Zumiez Inc and US06050WHM01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US06050WHM01 and Zumiez 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 Zumiez Inc are associated (or correlated) with 06050WHM0. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US06050WHM01 has no effect on the direction of Zumiez i.e., Zumiez and 06050WHM0 go up and down completely randomly.

Pair Corralation between Zumiez and 06050WHM0

If you would invest (100.00) in US06050WHM01 on December 4, 2024 and sell it today you would earn a total of  100.00  from holding US06050WHM01 or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Zumiez Inc  vs.  US06050WHM01

Zumiez Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Zumiez Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's primary indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

US06050WHM01

Risk-Adjusted Performance

Very Weak

Over the last 90 days US06050WHM01 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 06050WHM0 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Zumiez and 06050WHM0

The main advantage of trading using opposite Zumiez and 06050WHM0 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zumiez position performs unexpectedly, 06050WHM0 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 06050WHM0 will offset losses from the drop in 06050WHM0's long position.

The idea behind Zumiez Inc and US06050WHM01 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.