Correlation Between Bath Body and Westwing Comrcio
Can any of the company-specific risk be diversified away by investing in both Bath Body and Westwing Comrcio 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 Bath Body and Westwing Comrcio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bath Body Works and Westwing Comrcio Varejista, you can compare the effects of market volatilities on Bath Body and Westwing Comrcio 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 Bath Body with a short position of Westwing Comrcio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bath Body and Westwing Comrcio.
Diversification Opportunities for Bath Body and Westwing Comrcio
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bath and Westwing is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding Bath Body Works and Westwing Comrcio Varejista in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westwing Comrcio Var and Bath Body 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 Bath Body Works are associated (or correlated) with Westwing Comrcio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westwing Comrcio Var has no effect on the direction of Bath Body i.e., Bath Body and Westwing Comrcio go up and down completely randomly.
Pair Corralation between Bath Body and Westwing Comrcio
Assuming the 90 days trading horizon Bath Body Works is expected to under-perform the Westwing Comrcio. But the stock apears to be less risky and, when comparing its historical volatility, Bath Body Works is 3.96 times less risky than Westwing Comrcio. The stock trades about -0.46 of its potential returns per unit of risk. The Westwing Comrcio Varejista is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 490.00 in Westwing Comrcio Varejista on November 2, 2024 and sell it today you would lose (33.00) from holding Westwing Comrcio Varejista or give up 6.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bath Body Works vs. Westwing Comrcio Varejista
Performance |
| Timeline |
| Bath Body Works |
| Westwing Comrcio Var |
Bath Body and Westwing Comrcio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bath Body and Westwing Comrcio
The main advantage of trading using opposite Bath Body and Westwing Comrcio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bath Body position performs unexpectedly, Westwing Comrcio 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 Westwing Comrcio will offset losses from the drop in Westwing Comrcio's long position.| Bath Body vs. Mobly SA | Bath Body vs. Enjoei SA | Bath Body vs. Bemobi Mobile Tech | Bath Body vs. MPM Corpreos SA |
| Westwing Comrcio vs. Mobly SA | Westwing Comrcio vs. Enjoei SA | Westwing Comrcio vs. Bemobi Mobile Tech | Westwing Comrcio vs. MPM Corpreos SA |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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