Correlation Between Under Armour and Mattel
Can any of the company-specific risk be diversified away by investing in both Under Armour and Mattel 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 Under Armour and Mattel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Under Armour C and Mattel Inc, you can compare the effects of market volatilities on Under Armour and Mattel 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 Under Armour with a short position of Mattel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Under Armour and Mattel.
Diversification Opportunities for Under Armour and Mattel
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Under and Mattel is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Under Armour C and Mattel Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mattel Inc and Under Armour 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 Under Armour C are associated (or correlated) with Mattel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mattel Inc has no effect on the direction of Under Armour i.e., Under Armour and Mattel go up and down completely randomly.
Pair Corralation between Under Armour and Mattel
Allowing for the 90-day total investment horizon Under Armour is expected to generate 2.73 times less return on investment than Mattel. In addition to that, Under Armour is 1.46 times more volatile than Mattel Inc. It trades about 0.0 of its total potential returns per unit of risk. Mattel Inc is currently generating about 0.0 per unit of volatility. If you would invest 1,928 in Mattel Inc on September 26, 2024 and sell it today you would lose (146.00) from holding Mattel Inc or give up 7.57% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Under Armour C vs. Mattel Inc
Performance |
Timeline |
Under Armour C |
Mattel Inc |
Under Armour and Mattel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Under Armour and Mattel
The main advantage of trading using opposite Under Armour and Mattel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Under Armour position performs unexpectedly, Mattel 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 Mattel will offset losses from the drop in Mattel's long position.Under Armour vs. Amer Sports, | Under Armour vs. Brunswick | Under Armour vs. BRP Inc | Under Armour vs. Vision Marine Technologies |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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