Correlation Between Hugo Boss and Media

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

By analyzing existing cross correlation between Hugo Boss AG and Media and Games, you can compare the effects of market volatilities on Hugo Boss and Media 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 Hugo Boss with a short position of Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hugo Boss and Media.

Diversification Opportunities for Hugo Boss and Media

-0.16

Correlation Coefficient

Hugo Boss  Media

Good diversification

The 3 months correlation between Hugo and Media is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Hugo Boss AG and Media and Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media and Games and Hugo Boss 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 Hugo Boss AG are associated (or correlated) with Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media and Games has no effect on the direction of Hugo Boss i.e., Hugo Boss and Media go up and down completely randomly.

Pair Corralation between Hugo Boss and Media

Assuming the 90 days trading horizon Hugo Boss AG is expected to generate 0.87 times more return on investment than Media. However, Hugo Boss AG is 1.15 times less risky than Media. It trades about 0.09 of its potential returns per unit of risk. Media and Games is currently generating about -0.03 per unit of risk. If you would invest  3,787  in Hugo Boss AG on September 25, 2024 and sell it today you would earn a total of  639.00  from holding Hugo Boss AG or generate 16.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Hugo Boss AG  vs.  Media and Games

Hugo Boss AG

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hugo Boss AG are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Hugo Boss exhibited solid returns over the last few months and may actually be approaching a breakup point.

Media and Games

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Media and Games has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Hugo Boss and Media

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

The idea behind Hugo Boss AG and Media and Games 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.