Dollar Tree Stock Volatility
| DLTR Stock | USD 122.56 0.87 0.71% |
Dollar Tree secures Sharpe Ratio (or Efficiency) of -0.0285, which denotes the company had a -0.0285% return per unit of risk over the last 3 months. Dollar Tree exposes twenty-two different technical indicators, which can help you to evaluate volatility embedded in its price movement. Please confirm Dollar Tree's Mean Deviation of 1.35, standard deviation of 2.3, and Variance of 5.28 to check the risk estimate we provide. Key indicators related to Dollar Tree's volatility include:
30 Days Market Risk | Chance Of Distress | 30 Days Economic Sensitivity |
Dollar Tree Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Dollar daily returns, and it is calculated using variance and standard deviation. We also use Dollar's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Dollar Tree volatility.
Dollar |
ESG Sustainability
While most ESG disclosures are voluntary, Dollar Tree's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Dollar Tree's managers and investors.Environment Score | Governance Score | Social Score |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Dollar Tree can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Dollar Tree at lower prices. For example, an investor can purchase Dollar stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Dollar Tree's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving against Dollar Stock
| 0.7 | VDKB | Vodka Brands Corp | PairCorr |
| 0.58 | DOLE | Dole PLC Financial Report 16th of May 2024 | PairCorr |
| 0.56 | BG | Bunge Limited Earnings Call Next Week | PairCorr |
| 0.5 | MO | Altria Group Earnings Call This Week | PairCorr |
| 0.45 | KR | Kroger Company Financial Report 20th of June 2024 | PairCorr |
| 0.41 | PM | Philip Morris Intern | PairCorr |
Dollar Tree Market Sensitivity And Downside Risk
Dollar Tree's beta coefficient measures the volatility of Dollar stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Dollar stock's returns against your selected market. In other words, Dollar Tree's beta of 0.97 provides an investor with an approximation of how much risk Dollar Tree stock can potentially add to one of your existing portfolios. Dollar Tree exhibits very low volatility with skewness of -3.56 and kurtosis of 21.48. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Dollar Tree's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Dollar Tree's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Dollar Tree Demand TrendCheck current 90 days Dollar Tree correlation with market (NYSE Composite)Dollar Beta |
Dollar standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 2.34 |
It is essential to understand the difference between upside risk (as represented by Dollar Tree's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Dollar Tree's daily returns or price. Since the actual investment returns on holding a position in dollar stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Dollar Tree.
Using Dollar Put Option to Manage Risk
Put options written on Dollar Tree grant holders of the option the right to sell a specified amount of Dollar Tree at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Dollar Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Dollar Tree's position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Dollar Tree will be realized, the loss incurred will be offset by the profits made with the option trade.
Dollar Tree's PUT expiring on 2024-04-26
Profit |
| Dollar Tree Price At Expiration |
Current Dollar Tree Insurance Chain
| Delta | Gamma | Open Int | Expiration | Current Spread | Last Price | |||
Put | 2024-04-26 PUT at $132.0 | -0.9195 | 0.0259 | 1 | 2024-04-26 | 9.05 - 12.0 | 10.1 | View |
Put | 2024-04-26 PUT at $131.0 | -0.9268 | 0.0351 | 5 | 2024-04-26 | 7.65 - 11.3 | 8.19 | View |
Put | 2024-04-26 PUT at $130.0 | -0.9363 | 0.0242 | 27 | 2024-04-26 | 7.15 - 9.7 | 8.06 | View |
Put | 2024-04-26 PUT at $129.0 | -0.71 | 0.0292 | 16 | 2024-04-26 | 5.65 - 9.3 | 7.27 | View |
Put | 2024-04-26 PUT at $128.0 | -0.7698 | 0.0384 | 21 | 2024-04-26 | 5.05 - 7.3 | 6.05 | View |
Put | 2024-04-26 PUT at $127.0 | -0.7759 | 0.0456 | 32 | 2024-04-26 | 3.45 - 6.1 | 5.03 | View |
Put | 2024-04-26 PUT at $126.0 | -0.7764 | 0.0558 | 72 | 2024-04-26 | 2.77 - 4.95 | 3.95 | View |
Put | 2024-04-26 PUT at $125.0 | -0.8232 | 0.0759 | 95 | 2024-04-26 | 2.9 - 4.6 | 3.6 | View |
Put | 2024-04-26 PUT at $124.0 | -0.7175 | 0.089 | 58 | 2024-04-26 | 2.7 - 2.95 | 2.93 | View |
Put | 2024-04-26 PUT at $123.0 | -0.6441 | 0.1131 | 46 | 2024-04-26 | 2.01 - 2.1 | 1.93 | View |
Put | 2024-04-26 PUT at $122.0 | -0.5258 | 0.1169 | 128 | 2024-04-26 | 1.45 - 1.53 | 1.5 | View |
Dollar Tree Stock Volatility Analysis
Volatility refers to the frequency at which Dollar Tree stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Dollar Tree's price changes. Investors will then calculate the volatility of Dollar Tree's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Dollar Tree's volatility:
Historical Volatility
This type of stock volatility measures Dollar Tree's fluctuations based on previous trends. It's commonly used to predict Dollar Tree's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Dollar Tree's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Dollar Tree's to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Dollar Tree Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Dollar Tree Projected Return Density Against Market
Given the investment horizon of 90 days Dollar Tree has a beta of 0.9662 suggesting Dollar Tree market returns are sensible to returns on the market. As the market goes up or down, Dollar Tree is expected to follow.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Dollar Tree or Consumer Staples Distribution & Retail sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Dollar Tree's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Dollar stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Dollar Tree has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the NYSE Composite. Predicted Return Density |
| Returns |
What Drives a Dollar Tree Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Dollar Tree Stock Risk Measures
Given the investment horizon of 90 days the coefficient of variation of Dollar Tree is -3512.3. The daily returns are distributed with a variance of 5.5 and standard deviation of 2.34. The mean deviation of Dollar Tree is currently at 1.37. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 0.62
α | Alpha over NYSE Composite | -0.19 | |
β | Beta against NYSE Composite | 0.97 | |
σ | Overall volatility | 2.34 | |
Ir | Information ratio | -0.08 |
Dollar Tree Stock Return Volatility
Dollar Tree historical daily return volatility represents how much of Dollar Tree stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The enterprise inherits 2.3445% risk (volatility on return distribution) over the 90 days horizon. By contrast, NYSE Composite accepts 0.637% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Dollar Tree Volatility
Volatility is a rate at which the price of Dollar Tree or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Dollar Tree may increase or decrease. In other words, similar to Dollar's beta indicator, it measures the risk of Dollar Tree and helps estimate the fluctuations that may happen in a short period of time. So if prices of Dollar Tree fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.| Last Reported | Projected for Next Year | ||
| Selling And Marketing Expenses | 109.6 M | 104.1 M | |
| Market Cap | 3.1 B | 4.9 B |
Dollar Tree's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Dollar Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Dollar Tree's price varies over time.
3 ways to utilize Dollar Tree's volatility to invest better
Higher Dollar Tree's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Dollar Tree stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Dollar Tree stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Dollar Tree investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Dollar Tree's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Dollar Tree's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Dollar Tree Investment Opportunity
Dollar Tree has a volatility of 2.34 and is 3.66 times more volatile than NYSE Composite. Compared to the overall equity markets, volatility of historical daily returns of Dollar Tree is lower than 20 percent of all global equities and portfolios over the last 90 days. You can use Dollar Tree to enhance the returns of your portfolios. The stock experiences a moderate upward volatility. Check odds of Dollar Tree to be traded at $134.82 in 90 days.Modest diversification
The correlation between Dollar Tree and NYA is 0.26 (i.e., Modest diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Dollar Tree and NYA in the same portfolio, assuming nothing else is changed.
Dollar Tree Additional Risk Indicators
The analysis of Dollar Tree's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Dollar Tree's investment and either accepting that risk or mitigating it. Along with some common measures of Dollar Tree stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | (0.02) | |||
| Market Risk Adjusted Performance | (0.11) | |||
| Mean Deviation | 1.35 | |||
| Coefficient Of Variation | (2,267) | |||
| Standard Deviation | 2.3 | |||
| Variance | 5.28 | |||
| Information Ratio | (0.08) |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Dollar Tree Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Dollar Tree as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Dollar Tree's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Dollar Tree's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Dollar Tree.
When determining whether Dollar Tree is a strong investment it is important to analyze Dollar Tree's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Dollar Tree's future performance. For an informed investment choice regarding Dollar Stock, refer to the following important reports: Check out Investing Opportunities to better understand how to build diversified portfolios, which includes a position in Dollar Tree. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in estimate. To learn how to invest in Dollar Stock, please use our How to Invest in Dollar Tree guide.You can also try the AI Investment Finder module to use AI to screen and filter profitable investment opportunities.
Complementary Tools for Dollar Stock analysis
When running Dollar Tree's price analysis, check to measure Dollar Tree's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Dollar Tree is operating at the current time. Most of Dollar Tree's value examination focuses on studying past and present price action to predict the probability of Dollar Tree's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Dollar Tree's price. Additionally, you may evaluate how the addition of Dollar Tree to your portfolios can decrease your overall portfolio volatility.
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Is Dollar Tree's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Dollar Tree. If investors know Dollar will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Dollar Tree listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth (0.19) | Earnings Share (4.55) | Revenue Per Share 139.425 | Quarterly Revenue Growth 0.119 | Return On Assets 0.0498 |
The market value of Dollar Tree is measured differently than its book value, which is the value of Dollar that is recorded on the company's balance sheet. Investors also form their own opinion of Dollar Tree's value that differs from its market value or its book value, called intrinsic value, which is Dollar Tree's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Dollar Tree's market value can be influenced by many factors that don't directly affect Dollar Tree's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Dollar Tree's value and its price as these two are different measures arrived at by different means. Investors typically determine if Dollar Tree is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Dollar Tree's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.