Correlation Between Kate Spade and Unilever PLC
Can any of the company-specific risk be diversified away by investing in both Kate Spade and Unilever PLC 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 Kate Spade and Unilever PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kate Spade and Unilever PLC ADR, you can compare the effects of market volatilities on Kate Spade and Unilever PLC 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 Kate Spade with a short position of Unilever PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kate Spade and Unilever PLC.
Diversification Opportunities for Kate Spade and Unilever PLC
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kate and Unilever is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Kate Spade and Unilever PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unilever PLC ADR and Kate Spade 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 Kate Spade are associated (or correlated) with Unilever PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unilever PLC ADR has no effect on the direction of Kate Spade i.e., Kate Spade and Unilever PLC go up and down completely randomly.
Pair Corralation between Kate Spade and Unilever PLC
If you would invest (100.00) in Kate Spade on January 24, 2024 and sell it today you would earn a total of 100.00 from holding Kate Spade 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 |
Kate Spade vs. Unilever PLC ADR
Performance |
Timeline |
Kate Spade |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Unilever PLC ADR |
Kate Spade and Unilever PLC Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kate Spade and Unilever PLC
The main advantage of trading using opposite Kate Spade and Unilever PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kate Spade position performs unexpectedly, Unilever PLC 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 Unilever PLC will offset losses from the drop in Unilever PLC's long position.Kate Spade vs. National Vision Holdings | Kate Spade vs. Cedar Realty Trust | Kate Spade vs. LuxUrban Hotels 1300 | Kate Spade vs. Arhaus Inc |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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