Correlation Between Big Lots and Tuesday Morning
Can any of the company-specific risk be diversified away by investing in both Big Lots and Tuesday Morning 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 Big Lots and Tuesday Morning into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Big Lots and Tuesday Morning, you can compare the effects of market volatilities on Big Lots and Tuesday Morning 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 Big Lots with a short position of Tuesday Morning. Check out your portfolio center. Please also check ongoing floating volatility patterns of Big Lots and Tuesday Morning.
Diversification Opportunities for Big Lots and Tuesday Morning
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Big and Tuesday is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Big Lots and Tuesday Morning in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tuesday Morning and Big Lots 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 Big Lots are associated (or correlated) with Tuesday Morning. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tuesday Morning has no effect on the direction of Big Lots i.e., Big Lots and Tuesday Morning go up and down completely randomly.
Pair Corralation between Big Lots and Tuesday Morning
If you would invest (100.00) in Tuesday Morning on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Tuesday Morning 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 |
Big Lots vs. Tuesday Morning
Performance |
| Timeline |
| Big Lots |
| Tuesday Morning |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Big Lots and Tuesday Morning Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Big Lots and Tuesday Morning
The main advantage of trading using opposite Big Lots and Tuesday Morning positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Big Lots position performs unexpectedly, Tuesday Morning 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 Tuesday Morning will offset losses from the drop in Tuesday Morning's long position.The idea behind Big Lots and Tuesday Morning 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.| Tuesday Morning vs. Asbury Automotive Group | Tuesday Morning vs. Cedar Realty Trust | Tuesday Morning vs. Western Acquisition Ventures | Tuesday Morning vs. Artisan Partners Asset |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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