Correlation Between Academy Sports and Lsv Global

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

By analyzing existing cross correlation between Academy Sports Outdoors and Lsv Global Value, you can compare the effects of market volatilities on Academy Sports and Lsv Global 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 Academy Sports with a short position of Lsv Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Academy Sports and Lsv Global.

Diversification Opportunities for Academy Sports and Lsv Global

0.89

Correlation Coefficient

Academy Sports  Lsv Global

Very poor diversification

The 3 months correlation between Academy and Lsv is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Academy Sports Outdoors and Lsv Global Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lsv Global Value and Academy Sports 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 Academy Sports Outdoors are associated (or correlated) with Lsv Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lsv Global Value has no effect on the direction of Academy Sports i.e., Academy Sports and Lsv Global go up and down completely randomly.

Pair Corralation between Academy Sports and Lsv Global

Considering the 90-day investment horizon Academy Sports Outdoors is expected to generate 4.68 times more return on investment than Lsv Global. However, Academy Sports is 4.68 times more volatile than Lsv Global Value. It trades about 0.15 of its potential returns per unit of risk. Lsv Global Value is currently generating about 0.16 per unit of risk. If you would invest  3,877  in Academy Sports Outdoors on May 7, 2025 and sell it today you would earn a total of  1,276  from holding Academy Sports Outdoors or generate 32.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Academy Sports Outdoors  vs.  Lsv Global Value

Academy Sports Outdoors

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Academy Sports Outdoors are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Academy Sports displayed solid returns over the last few months and may actually be approaching a breakup point.

Lsv Global Value

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Lsv Global Value are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Lsv Global may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Academy Sports and Lsv Global

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

The idea behind Academy Sports Outdoors and Lsv Global Value 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.

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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.