Correlation Between Skechers USA and NORFOLK
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By analyzing existing cross correlation between Skechers USA and NORFOLK SOUTHN P, you can compare the effects of market volatilities on Skechers USA and NORFOLK 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 Skechers USA with a short position of NORFOLK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skechers USA and NORFOLK.
Diversification Opportunities for Skechers USA and NORFOLK
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Skechers and NORFOLK is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Skechers USA and NORFOLK SOUTHN P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORFOLK SOUTHN P and Skechers USA 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 Skechers USA are associated (or correlated) with NORFOLK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORFOLK SOUTHN P has no effect on the direction of Skechers USA i.e., Skechers USA and NORFOLK go up and down completely randomly.
Pair Corralation between Skechers USA and NORFOLK
Considering the 90-day investment horizon Skechers USA is expected to generate 1.7 times more return on investment than NORFOLK. However, Skechers USA is 1.7 times more volatile than NORFOLK SOUTHN P. It trades about 0.06 of its potential returns per unit of risk. NORFOLK SOUTHN P is currently generating about -0.18 per unit of risk. If you would invest 6,310 in Skechers USA on September 23, 2024 and sell it today you would earn a total of 455.00 from holding Skechers USA or generate 7.21% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 47.69% |
Values | Daily Returns |
Skechers USA vs. NORFOLK SOUTHN P
Performance |
Timeline |
Skechers USA |
NORFOLK SOUTHN P |
Skechers USA and NORFOLK Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Skechers USA and NORFOLK
The main advantage of trading using opposite Skechers USA and NORFOLK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Skechers USA position performs unexpectedly, NORFOLK 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 NORFOLK will offset losses from the drop in NORFOLK's long position.Skechers USA vs. Weyco Group | Skechers USA vs. Caleres | Skechers USA vs. Designer Brands | Skechers USA vs. Vera Bradley |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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