Correlation Between Oxford Industries and Vince Holding

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

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

Diversification Opportunities for Oxford Industries and Vince Holding

0.01

Correlation Coefficient

Oxford Industries  Vince Holding

Significant diversification

The 3 months correlation between Oxford and Vince is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Industries and Vince Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vince Holding Corp and Oxford Industries 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 Oxford Industries are associated (or correlated) with Vince Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vince Holding Corp has no effect on the direction of Oxford Industries i.e., Oxford Industries and Vince Holding go up and down completely randomly.

Pair Corralation between Oxford Industries and Vince Holding

Considering the 90-day investment horizon Oxford Industries is expected to under-perform the Vince Holding. But the stock apears to be less risky and, when comparing its historical volatility, Oxford Industries is 2.4 times less risky than Vince Holding. The stock trades about -0.02 of its potential returns per unit of risk. The Vince Holding Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  176.00  in Vince Holding Corp on September 2, 2024 and sell it today you would lose (6.00) from holding Vince Holding Corp or give up 3.41% of portfolio value over 90 days.

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

Oxford Industries  vs.  Vince Holding Corp

Oxford Industries

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oxford Industries has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Oxford Industries is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Vince Holding Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vince Holding Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Vince Holding is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Oxford Industries and Vince Holding

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

The idea behind Oxford Industries and Vince Holding Corp 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.