Correlation Between Abercrombie Fitch and Boot Barn
Can any of the company-specific risk be diversified away by investing in both Abercrombie Fitch and Boot Barn 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 Abercrombie Fitch and Boot Barn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Abercrombie Fitch and Boot Barn Holdings, you can compare the effects of market volatilities on Abercrombie Fitch and Boot Barn 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 Abercrombie Fitch with a short position of Boot Barn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abercrombie Fitch and Boot Barn.
Diversification Opportunities for Abercrombie Fitch and Boot Barn
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Abercrombie and Boot is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Abercrombie Fitch and Boot Barn Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boot Barn Holdings and Abercrombie Fitch 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 Abercrombie Fitch are associated (or correlated) with Boot Barn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boot Barn Holdings has no effect on the direction of Abercrombie Fitch i.e., Abercrombie Fitch and Boot Barn go up and down completely randomly.
Pair Corralation between Abercrombie Fitch and Boot Barn
Considering the 90-day investment horizon Abercrombie Fitch is expected to generate 1.31 times more return on investment than Boot Barn. However, Abercrombie Fitch is 1.31 times more volatile than Boot Barn Holdings. It trades about 0.12 of its potential returns per unit of risk. Boot Barn Holdings is currently generating about 0.08 per unit of risk. If you would invest 7,685 in Abercrombie Fitch on June 3, 2025 and sell it today you would earn a total of 1,668 from holding Abercrombie Fitch or generate 21.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Abercrombie Fitch vs. Boot Barn Holdings
Performance |
| Timeline |
| Abercrombie Fitch |
| Boot Barn Holdings |
Abercrombie Fitch and Boot Barn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abercrombie Fitch and Boot Barn
The main advantage of trading using opposite Abercrombie Fitch and Boot Barn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abercrombie Fitch position performs unexpectedly, Boot Barn 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 Boot Barn will offset losses from the drop in Boot Barn's long position.| Abercrombie Fitch vs. American Eagle Outfitters | Abercrombie Fitch vs. Urban Outfitters | Abercrombie Fitch vs. The Gap, | Abercrombie Fitch vs. Foot Locker |
| Boot Barn vs. Burlington Stores | Boot Barn vs. Buckle Inc | Boot Barn vs. Carters | Boot Barn vs. Citi Trends |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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