Correlation Between TRADEDOUBLER and American Eagle

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

By analyzing existing cross correlation between TRADEDOUBLER AB SK and American Eagle Outfitters, you can compare the effects of market volatilities on TRADEDOUBLER and American Eagle 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 TRADEDOUBLER with a short position of American Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRADEDOUBLER and American Eagle.

Diversification Opportunities for TRADEDOUBLER and American Eagle

-0.18

Correlation Coefficient

TRADEDOUBLER  American Eagle

Good diversification

The 3 months correlation between TRADEDOUBLER and American is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding TRADEDOUBLER AB SK and American Eagle Outfitters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Eagle Outfitters and TRADEDOUBLER 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 TRADEDOUBLER AB SK are associated (or correlated) with American Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Eagle Outfitters has no effect on the direction of TRADEDOUBLER i.e., TRADEDOUBLER and American Eagle go up and down completely randomly.

Pair Corralation between TRADEDOUBLER and American Eagle

Assuming the 90 days horizon TRADEDOUBLER AB SK is expected to under-perform the American Eagle. In addition to that, TRADEDOUBLER is 1.03 times more volatile than American Eagle Outfitters. It trades about -0.12 of its total potential returns per unit of risk. American Eagle Outfitters is currently generating about -0.06 per unit of volatility. If you would invest  905.00  in American Eagle Outfitters on April 5, 2025 and sell it today you would lose (35.00) from holding American Eagle Outfitters or give up 3.87% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.65%
Values	Daily Returns

TRADEDOUBLER AB SK  vs.  American Eagle Outfitters

TRADEDOUBLER AB SK

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TRADEDOUBLER AB SK are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, TRADEDOUBLER may actually be approaching a critical reversion point that can send shares even higher in August 2025.

American Eagle Outfitters

Risk-Adjusted Performance

Very Weak

Over the last 90 days American Eagle Outfitters has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, American Eagle is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with TRADEDOUBLER and American Eagle

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

The idea behind TRADEDOUBLER AB SK and American Eagle Outfitters 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.