Correlation Between Boohoo PLC and Oriental Culture
Can any of the company-specific risk be diversified away by investing in both Boohoo PLC and Oriental Culture 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 Boohoo PLC and Oriental Culture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BoohooCom PLC ADR and Oriental Culture Holding, you can compare the effects of market volatilities on Boohoo PLC and Oriental Culture 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 Boohoo PLC with a short position of Oriental Culture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boohoo PLC and Oriental Culture.
Diversification Opportunities for Boohoo PLC and Oriental Culture
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boohoo and Oriental is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding BoohooCom PLC ADR and Oriental Culture Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oriental Culture Holding and Boohoo 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 BoohooCom PLC ADR are associated (or correlated) with Oriental Culture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oriental Culture Holding has no effect on the direction of Boohoo PLC i.e., Boohoo PLC and Oriental Culture go up and down completely randomly.
Pair Corralation between Boohoo PLC and Oriental Culture
Assuming the 90 days horizon BoohooCom PLC ADR is expected to under-perform the Oriental Culture. In addition to that, Boohoo PLC is 1.69 times more volatile than Oriental Culture Holding. It trades about -0.22 of its total potential returns per unit of risk. Oriental Culture Holding is currently generating about 0.17 per unit of volatility. If you would invest 117.00 in Oriental Culture Holding on December 1, 2024 and sell it today you would earn a total of 13.00 from holding Oriental Culture Holding or generate 11.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BoohooCom PLC ADR vs. Oriental Culture Holding
Performance |
| Timeline |
| BoohooCom PLC ADR |
| Oriental Culture Holding |
Boohoo PLC and Oriental Culture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boohoo PLC and Oriental Culture
The main advantage of trading using opposite Boohoo PLC and Oriental Culture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boohoo PLC position performs unexpectedly, Oriental Culture 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 Oriental Culture will offset losses from the drop in Oriental Culture's long position.| Boohoo PLC vs. ASOS plc PK | Boohoo PLC vs. Berkeley Group Holdings | Boohoo PLC vs. ZALANDO SE ADR | Boohoo PLC vs. Barratt Developments PLC |
| Oriental Culture vs. Hour Loop | Oriental Culture vs. Jowell Global | Oriental Culture vs. Qurate Retail Series | Oriental Culture vs. Emerge Commerce |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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