Correlation Between Turtle Beach and G III

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

By analyzing existing cross correlation between Turtle Beach Corp and G III Apparel Group, you can compare the effects of market volatilities on Turtle Beach and G III 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 Turtle Beach with a short position of G III. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turtle Beach and G III.

Diversification Opportunities for Turtle Beach and G III

-0.75

Correlation Coefficient

Turtle Beach  G III

Pay attention - limited upside

The 3 months correlation between Turtle and GIII is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Turtle Beach Corp and G III Apparel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G III Apparel and Turtle Beach 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 Turtle Beach Corp are associated (or correlated) with G III. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G III Apparel has no effect on the direction of Turtle Beach i.e., Turtle Beach and G III go up and down completely randomly.

Pair Corralation between Turtle Beach and G III

Given the investment horizon of 90 days Turtle Beach is expected to generate 2.11 times less return on investment than G III. In addition to that, Turtle Beach is 1.06 times more volatile than G III Apparel Group. It trades about 0.01 of its total potential returns per unit of risk. G III Apparel Group is currently generating about 0.03 per unit of volatility. If you would invest  2,448  in G III Apparel Group on February 5, 2024 and sell it today you would earn a total of  411.00  from holding G III Apparel Group or generate 16.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Turtle Beach Corp  vs.  G III Apparel Group

Turtle Beach Corp

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Turtle Beach Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting basic indicators, Turtle Beach reported solid returns over the last few months and may actually be approaching a breakup point.

G III Apparel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days G III Apparel Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, G III is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Turtle Beach and G III

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

The idea behind Turtle Beach Corp and G III Apparel Group 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.