Correlation Between Hanesbrands and MultiMetaVerse Holdings

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

By analyzing existing cross correlation between Hanesbrands and MultiMetaVerse Holdings Limited, you can compare the effects of market volatilities on Hanesbrands and MultiMetaVerse Holdings 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 MultiMetaVerse Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and MultiMetaVerse Holdings.

Diversification Opportunities for Hanesbrands and MultiMetaVerse Holdings

-0.3

Correlation Coefficient

Hanesbrands  MultiMetaVerse Holdings

Very good diversification

The 3 months correlation between Hanesbrands and MultiMetaVerse is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and MultiMetaVerse Holdings Limite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MultiMetaVerse Holdings 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 MultiMetaVerse Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MultiMetaVerse Holdings has no effect on the direction of Hanesbrands i.e., Hanesbrands and MultiMetaVerse Holdings go up and down completely randomly.

Pair Corralation between Hanesbrands and MultiMetaVerse Holdings

Considering the 90-day investment horizon Hanesbrands is expected to generate 43.78 times less return on investment than MultiMetaVerse Holdings. But when comparing it to its historical volatility, Hanesbrands is 17.29 times less risky than MultiMetaVerse Holdings. It trades about 0.04 of its potential returns per unit of risk. MultiMetaVerse Holdings Limited is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  14.00  in MultiMetaVerse Holdings Limited on September 4, 2024 and sell it today you would lose (11.35) from holding MultiMetaVerse Holdings Limited or give up 81.07% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	71.11%
Values	Daily Returns

Hanesbrands  vs.  MultiMetaVerse Holdings Limite

Hanesbrands

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hanesbrands are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly conflicting fundamental drivers, Hanesbrands demonstrated solid returns over the last few months and may actually be approaching a breakup point.

MultiMetaVerse Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MultiMetaVerse Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, MultiMetaVerse Holdings is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Hanesbrands and MultiMetaVerse Holdings

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

The idea behind Hanesbrands and MultiMetaVerse Holdings Limited 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.