Correlation Between Coach and Tumi Holdings
Can any of the company-specific risk be diversified away by investing in both Coach and Tumi Holdings 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 Coach and Tumi Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coach Inc and Tumi Holdings, you can compare the effects of market volatilities on Coach and Tumi Holdings 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 Coach with a short position of Tumi Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coach and Tumi Holdings.
Diversification Opportunities for Coach and Tumi Holdings
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coach and Tumi is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Coach Inc and Tumi Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tumi Holdings and Coach 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 Coach Inc are associated (or correlated) with Tumi Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tumi Holdings has no effect on the direction of Coach i.e., Coach and Tumi Holdings go up and down completely randomly.
Pair Corralation between Coach and Tumi Holdings
If you would invest (100.00) in Tumi Holdings on January 27, 2024 and sell it today you would earn a total of 100.00 from holding Tumi Holdings or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coach Inc vs. Tumi Holdings
Performance |
| Timeline |
| Coach Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Tumi Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Coach and Tumi Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coach and Tumi Holdings
The main advantage of trading using opposite Coach and Tumi Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coach position performs unexpectedly, Tumi Holdings 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 Tumi Holdings will offset losses from the drop in Tumi Holdings' long position.The idea behind Coach Inc and Tumi Holdings 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.| Tumi Holdings vs. Forsys Metals Corp | Tumi Holdings vs. Western Metals | Tumi Holdings vs. Grupo Televisa SAB | Tumi Holdings vs. Radcom |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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