Correlation Between Dicks Sporting and Cabelas
Can any of the company-specific risk be diversified away by investing in both Dicks Sporting and Cabelas 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 Dicks Sporting and Cabelas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dicks Sporting Goods and Cabelas, you can compare the effects of market volatilities on Dicks Sporting and Cabelas 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 Dicks Sporting with a short position of Cabelas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dicks Sporting and Cabelas.
Diversification Opportunities for Dicks Sporting and Cabelas
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dicks and Cabelas is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dicks Sporting Goods and Cabelas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cabelas and Dicks Sporting 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 Dicks Sporting Goods are associated (or correlated) with Cabelas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cabelas has no effect on the direction of Dicks Sporting i.e., Dicks Sporting and Cabelas go up and down completely randomly.
Pair Corralation between Dicks Sporting and Cabelas
If you would invest (100.00) in Cabelas on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Cabelas or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Dicks Sporting Goods vs. Cabelas
Performance |
| Timeline |
| Dicks Sporting Goods |
| Cabelas |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Dicks Sporting and Cabelas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dicks Sporting and Cabelas
The main advantage of trading using opposite Dicks Sporting and Cabelas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dicks Sporting position performs unexpectedly, Cabelas 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 Cabelas will offset losses from the drop in Cabelas' long position.| Dicks Sporting vs. Williams Sonoma | Dicks Sporting vs. AutoZone | Dicks Sporting vs. Best Buy Co | Dicks Sporting vs. RH |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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