Correlation Between Tillys and Tandy Leather
Can any of the company-specific risk be diversified away by investing in both Tillys and Tandy Leather 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 Tillys and Tandy Leather into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tillys Inc and Tandy Leather Factory, you can compare the effects of market volatilities on Tillys and Tandy Leather 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 Tillys with a short position of Tandy Leather. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tillys and Tandy Leather.
Diversification Opportunities for Tillys and Tandy Leather
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tillys and Tandy is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Tillys Inc and Tandy Leather Factory in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tandy Leather Factory and Tillys 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 Tillys Inc are associated (or correlated) with Tandy Leather. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tandy Leather Factory has no effect on the direction of Tillys i.e., Tillys and Tandy Leather go up and down completely randomly.
Pair Corralation between Tillys and Tandy Leather
Given the investment horizon of 90 days Tillys Inc is expected to generate 5.16 times more return on investment than Tandy Leather. However, Tillys is 5.16 times more volatile than Tandy Leather Factory. It trades about -0.02 of its potential returns per unit of risk. Tandy Leather Factory is currently generating about -0.2 per unit of risk. If you would invest 158.00 in Tillys Inc on August 16, 2025 and sell it today you would lose (24.00) from holding Tillys Inc or give up 15.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tillys Inc vs. Tandy Leather Factory
Performance |
| Timeline |
| Tillys Inc |
| Tandy Leather Factory |
Tillys and Tandy Leather Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tillys and Tandy Leather
The main advantage of trading using opposite Tillys and Tandy Leather positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tillys position performs unexpectedly, Tandy Leather 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 Tandy Leather will offset losses from the drop in Tandy Leather's long position.| Tillys vs. Allbirds | Tillys vs. Destination XL Group | Tillys vs. Culp Inc | Tillys vs. Natural Health Trend |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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