Correlation Between XLMedia PLC and FAST RETAIL
Can any of the company-specific risk be diversified away by investing in both XLMedia PLC and FAST RETAIL 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 XLMedia PLC and FAST RETAIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XLMedia PLC and FAST RETAIL ADR, you can compare the effects of market volatilities on XLMedia PLC and FAST RETAIL 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 XLMedia PLC with a short position of FAST RETAIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of XLMedia PLC and FAST RETAIL.
Diversification Opportunities for XLMedia PLC and FAST RETAIL
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between XLMedia and FAST is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding XLMedia PLC and FAST RETAIL ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FAST RETAIL ADR and XLMedia PLC 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 XLMedia PLC are associated (or correlated) with FAST RETAIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FAST RETAIL ADR has no effect on the direction of XLMedia PLC i.e., XLMedia PLC and FAST RETAIL go up and down completely randomly.
Pair Corralation between XLMedia PLC and FAST RETAIL
Assuming the 90 days horizon XLMedia PLC is expected to generate 0.88 times more return on investment than FAST RETAIL. However, XLMedia PLC is 1.13 times less risky than FAST RETAIL. It trades about 0.21 of its potential returns per unit of risk. FAST RETAIL ADR is currently generating about 0.15 per unit of risk. If you would invest 13.00 in XLMedia PLC on September 1, 2024 and sell it today you would earn a total of 1.00 from holding XLMedia PLC or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
XLMedia PLC vs. FAST RETAIL ADR
Performance |
| Timeline |
| XLMedia PLC |
| FAST RETAIL ADR |
XLMedia PLC and FAST RETAIL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XLMedia PLC and FAST RETAIL
The main advantage of trading using opposite XLMedia PLC and FAST RETAIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XLMedia PLC position performs unexpectedly, FAST RETAIL 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 FAST RETAIL will offset losses from the drop in FAST RETAIL's long position.| XLMedia PLC vs. FLOW TRADERS LTD | XLMedia PLC vs. Auto Trader Group | XLMedia PLC vs. Carsales | XLMedia PLC vs. CarsalesCom |
| FAST RETAIL vs. AOYAMA TRADING | FAST RETAIL vs. Global Fashion Group | FAST RETAIL vs. Superior Plus Corp | FAST RETAIL vs. NMI Holdings |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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