Correlation Between Hanesbrands and Axogen

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Hanesbrands and Axogen 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 Hanesbrands and Axogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanesbrands and Axogen Inc, you can compare the effects of market volatilities on Hanesbrands and Axogen 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 Hanesbrands with a short position of Axogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanesbrands and Axogen.

Diversification Opportunities for Hanesbrands and Axogen

0.39
  Correlation Coefficient

Weak diversification

The 3 months correlation between Hanesbrands and Axogen is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Hanesbrands and Axogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axogen Inc and Hanesbrands 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 Hanesbrands are associated (or correlated) with Axogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axogen Inc has no effect on the direction of Hanesbrands i.e., Hanesbrands and Axogen go up and down completely randomly.

Pair Corralation between Hanesbrands and Axogen

Considering the 90-day investment horizon Hanesbrands is expected to generate 1.16 times less return on investment than Axogen. But when comparing it to its historical volatility, Hanesbrands is 1.18 times less risky than Axogen. It trades about 0.03 of its potential returns per unit of risk. Axogen Inc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,040  in Axogen Inc on August 17, 2024 and sell it today you would earn a total of  207.00  from holding Axogen Inc or generate 19.9% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Hanesbrands  vs.  Axogen Inc

 Performance 
       Timeline  
Hanesbrands 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Hanesbrands are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly conflicting fundamental drivers, Hanesbrands demonstrated solid returns over the last few months and may actually be approaching a breakup point.
Axogen Inc 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Axogen Inc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Axogen is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Hanesbrands and Axogen Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Hanesbrands and Axogen

The main advantage of trading using opposite Hanesbrands and Axogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanesbrands position performs unexpectedly, Axogen 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 Axogen will offset losses from the drop in Axogen's long position.
The idea behind Hanesbrands and Axogen Inc 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.
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.

Other Complementary Tools

Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Equity Valuation
Check real value of public entities based on technical and fundamental data
FinTech Suite
Use AI to screen and filter profitable investment opportunities
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account