Correlation Between Ascena Retail and Abercrombie Fitch
Can any of the company-specific risk be diversified away by investing in both Ascena Retail and Abercrombie Fitch 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 Ascena Retail and Abercrombie Fitch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ascena Retail Group and Abercrombie Fitch, you can compare the effects of market volatilities on Ascena Retail and Abercrombie Fitch 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 Ascena Retail with a short position of Abercrombie Fitch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ascena Retail and Abercrombie Fitch.
Diversification Opportunities for Ascena Retail and Abercrombie Fitch
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ascena and Abercrombie is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ascena Retail Group and Abercrombie Fitch in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abercrombie Fitch and Ascena Retail 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 Ascena Retail Group are associated (or correlated) with Abercrombie Fitch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abercrombie Fitch has no effect on the direction of Ascena Retail i.e., Ascena Retail and Abercrombie Fitch go up and down completely randomly.
Pair Corralation between Ascena Retail and Abercrombie Fitch
If you would invest (100.00) in Ascena Retail Group on January 25, 2024 and sell it today you would earn a total of 100.00 from holding Ascena Retail Group or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Ascena Retail Group vs. Abercrombie Fitch
Performance |
| Timeline |
| Ascena Retail Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Abercrombie Fitch |
Ascena Retail and Abercrombie Fitch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ascena Retail and Abercrombie Fitch
The main advantage of trading using opposite Ascena Retail and Abercrombie Fitch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ascena Retail position performs unexpectedly, Abercrombie Fitch 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 Abercrombie Fitch will offset losses from the drop in Abercrombie Fitch's long position.| Ascena Retail vs. PVH Corp | Ascena Retail vs. Steven Madden | Ascena Retail vs. JJill Inc | Ascena Retail vs. Ralph Lauren Corp |
| Abercrombie Fitch vs. Gap Inc | Abercrombie Fitch vs. Urban Outfitters | Abercrombie Fitch vs. Foot Locker | Abercrombie Fitch vs. Childrens Place |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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