Correlation Between Hanesbrands and Clearbridge Small
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Clearbridge Small 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 Hanesbrands and Clearbridge Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Clearbridge Small Cap, you can compare the effects of market volatilities on Hanesbrands and Clearbridge Small 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 Hanesbrands with a short position of Clearbridge Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Clearbridge Small.
Diversification Opportunities for Hanesbrands and Clearbridge Small
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hanesbrands and Clearbridge is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Clearbridge Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge Small Cap and Hanesbrands 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 Hanesbrands are associated (or correlated) with Clearbridge Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge Small Cap has no effect on the direction of Hanesbrands i.e., Hanesbrands and Clearbridge Small go up and down completely randomly.
Pair Corralation between Hanesbrands and Clearbridge Small
Considering the 90-day investment horizon Hanesbrands is expected to generate 2.64 times more return on investment than Clearbridge Small. However, Hanesbrands is 2.64 times more volatile than Clearbridge Small Cap. It trades about 0.13 of its potential returns per unit of risk. Clearbridge Small Cap is currently generating about 0.16 per unit of risk. If you would invest 676.00 in Hanesbrands on September 13, 2024 and sell it today you would earn a total of 165.00 from holding Hanesbrands or generate 24.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Hanesbrands vs. Clearbridge Small Cap
Performance |
Timeline |
Hanesbrands |
Clearbridge Small Cap |
Hanesbrands and Clearbridge Small Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hanesbrands and Clearbridge Small
The main advantage of trading using opposite Hanesbrands and Clearbridge Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Clearbridge Small 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 Clearbridge Small will offset losses from the drop in Clearbridge Small's long position.Hanesbrands vs. Ralph Lauren Corp | Hanesbrands vs. Levi Strauss Co | Hanesbrands vs. Under Armour C | Hanesbrands vs. PVH Corp |
Clearbridge Small vs. American Funds Inflation | Clearbridge Small vs. Ab Bond Inflation | Clearbridge Small vs. Ab Bond Inflation | Clearbridge Small vs. Lord Abbett Inflation |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
Global Correlations Find global opportunities by holding instruments from different markets | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories |