Correlation Between 1StdibsCom and Carters

Can any of the company-specific risk be diversified away by investing in both 1StdibsCom and Carters 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 1StdibsCom and Carters into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 1StdibsCom and Carters, you can compare the effects of market volatilities on 1StdibsCom and Carters 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 1StdibsCom with a short position of Carters. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1StdibsCom and Carters.

Diversification Opportunities for 1StdibsCom and Carters

-0.55

Correlation Coefficient

1StdibsCom  Carters

Excellent diversification

The 3 months correlation between 1StdibsCom and Carters is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding 1StdibsCom and Carters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carters and 1StdibsCom 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 1StdibsCom are associated (or correlated) with Carters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carters has no effect on the direction of 1StdibsCom i.e., 1StdibsCom and Carters go up and down completely randomly.

Pair Corralation between 1StdibsCom and Carters

Given the investment horizon of 90 days 1StdibsCom is expected to generate 0.9 times more return on investment than Carters. However, 1StdibsCom is 1.11 times less risky than Carters. It trades about 0.05 of its potential returns per unit of risk. Carters is currently generating about -0.06 per unit of risk. If you would invest  252.00  in 1StdibsCom on April 21, 2025 and sell it today you would earn a total of  16.00  from holding 1StdibsCom or generate 6.35% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

1StdibsCom  vs.  Carters

1StdibsCom

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in 1StdibsCom are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady fundamental drivers, 1StdibsCom may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Carters

Risk-Adjusted Performance

Very Weak

Over the last 90 days Carters has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with 1StdibsCom and Carters

The main advantage of trading using opposite 1StdibsCom and Carters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1StdibsCom position performs unexpectedly, Carters 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 Carters will offset losses from the drop in Carters' long position.

The idea behind 1StdibsCom and Carters 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.