Correlation Between AKA Brands and Alibaba Group
Can any of the company-specific risk be diversified away by investing in both AKA Brands and Alibaba Group 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 AKA Brands and Alibaba Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKA Brands Holding and Alibaba Group Holding, you can compare the effects of market volatilities on AKA Brands and Alibaba Group 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 AKA Brands with a short position of Alibaba Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKA Brands and Alibaba Group.
Diversification Opportunities for AKA Brands and Alibaba Group
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between AKA and Alibaba is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding AKA Brands Holding and Alibaba Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alibaba Group Holding and AKA Brands 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 AKA Brands Holding are associated (or correlated) with Alibaba Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alibaba Group Holding has no effect on the direction of AKA Brands i.e., AKA Brands and Alibaba Group go up and down completely randomly.
Pair Corralation between AKA Brands and Alibaba Group
Considering the 90-day investment horizon AKA Brands Holding is expected to under-perform the Alibaba Group. In addition to that, AKA Brands is 1.51 times more volatile than Alibaba Group Holding. It trades about -0.13 of its total potential returns per unit of risk. Alibaba Group Holding is currently generating about -0.17 per unit of volatility. If you would invest 1,250 in Alibaba Group Holding on August 29, 2024 and sell it today you would lose (175.00) from holding Alibaba Group Holding or give up 14.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AKA Brands Holding vs. Alibaba Group Holding
Performance |
| Timeline |
| AKA Brands Holding |
| Alibaba Group Holding |
AKA Brands and Alibaba Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKA Brands and Alibaba Group
The main advantage of trading using opposite AKA Brands and Alibaba Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKA Brands position performs unexpectedly, Alibaba Group 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 Alibaba Group will offset losses from the drop in Alibaba Group's long position.| AKA Brands vs. Brilliant Earth Group | AKA Brands vs. Lulus Fashion Lounge | AKA Brands vs. Torrid Holdings | AKA Brands vs. Aveanna Healthcare Holdings |
| Alibaba Group vs. Meituan ADR | Alibaba Group vs. Meituan | Alibaba Group vs. Qurate Retail Series | Alibaba Group vs. ThredUp |
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.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |