Correlation Between Buckle and Dunelm Group

Can any of the company-specific risk be diversified away by investing in both Buckle and Dunelm Group 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 Buckle and Dunelm Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Buckle Inc and Dunelm Group PLC, you can compare the effects of market volatilities on Buckle and Dunelm Group 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 Buckle with a short position of Dunelm Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Buckle and Dunelm Group.

Diversification Opportunities for Buckle and Dunelm Group

0.01

Correlation Coefficient

Buckle  Dunelm Group

Significant diversification

The 3 months correlation between Buckle and Dunelm is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Buckle Inc and Dunelm Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunelm Group PLC and Buckle 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 Buckle Inc are associated (or correlated) with Dunelm Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunelm Group PLC has no effect on the direction of Buckle i.e., Buckle and Dunelm Group go up and down completely randomly.

Pair Corralation between Buckle and Dunelm Group

If you would invest  1,389  in Dunelm Group PLC on March 10, 2024 and sell it today you would earn a total of  0.00  from holding Dunelm Group PLC or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

Buckle Inc  vs.  Dunelm Group PLC

Buckle Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Buckle Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound forward-looking signals, Buckle is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Dunelm Group PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dunelm Group PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's primary indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Buckle and Dunelm Group

The main advantage of trading using opposite Buckle and Dunelm Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Buckle position performs unexpectedly, Dunelm Group 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 Dunelm Group will offset losses from the drop in Dunelm Group's long position.

The idea behind Buckle Inc and Dunelm Group PLC 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.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.