Correlation Between Designer Brands and Nordstrom
Can any of the company-specific risk be diversified away by investing in both Designer Brands and Nordstrom 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 Designer Brands and Nordstrom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Designer Brands and Nordstrom, you can compare the effects of market volatilities on Designer Brands and Nordstrom 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 Designer Brands with a short position of Nordstrom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Designer Brands and Nordstrom.
Diversification Opportunities for Designer Brands and Nordstrom
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Designer and Nordstrom is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Designer Brands and Nordstrom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordstrom and Designer Brands 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 Designer Brands are associated (or correlated) with Nordstrom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordstrom has no effect on the direction of Designer Brands i.e., Designer Brands and Nordstrom go up and down completely randomly.
Pair Corralation between Designer Brands and Nordstrom
If you would invest 1,547 in Nordstrom on January 19, 2024 and sell it today you would earn a total of 327.00 from holding Nordstrom or generate 21.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Designer Brands vs. Nordstrom
Performance |
| Timeline |
| Designer Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Nordstrom |
Designer Brands and Nordstrom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Designer Brands and Nordstrom
The main advantage of trading using opposite Designer Brands and Nordstrom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Designer Brands position performs unexpectedly, Nordstrom 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 Nordstrom will offset losses from the drop in Nordstrom's long position.| Designer Brands vs. Boston Omaha Corp | Designer Brands vs. Global E Online | Designer Brands vs. Innovid Corp | Designer Brands vs. BOS Better Online |
| Nordstrom vs. Marks Spencer Group | Nordstrom vs. Marks and Spencer | Nordstrom vs. Dillards Capital Trust | Nordstrom vs. Companhia Brasileira de |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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