Correlation Between Buckle and Express

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

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

Diversification Opportunities for Buckle and Express

0.35
  Correlation Coefficient
Buckle Inc
Express

Weak diversification

The 3 months correlation between Buckle and Express is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Buckle Inc and Express in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Express 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 Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Express has no effect on the direction of Buckle i.e., Buckle and Express go up and down completely randomly.

Pair Corralation between Buckle and Express

Considering the 90-day investment horizon Buckle is expected to generate 24.35 times less return on investment than Express. But when comparing it to its historical volatility, Buckle Inc is 3.16 times less risky than Express. It trades about 0.01 of its potential returns per unit of risk. Express is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  349.00  in Express on May 5, 2021 and sell it today you would earn a total of  165.00  from holding Express or generate 47.28% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Buckle Inc  vs.  Express

 Performance (%) 
      Timeline 
Buckle Inc 
 Buckle Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Buckle Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. 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.

Buckle Price Channel

Express 
 Express Performance
7 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Express are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile basic indicators, Express reported solid returns over the last few months and may actually be approaching a breakup point.

Express Price Channel

Buckle and Express Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Buckle and Express

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

Buckle Inc

Pair trading matchups for Buckle

The idea behind Buckle Inc and Express 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.

Express

Pair trading matchups for Express

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 Shere Portfolio module to track or share privately all of your investments from the convenience of any device.

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