Correlation Between Baozun and Coupang LLC
Can any of the company-specific risk be diversified away by investing in both Baozun and Coupang LLC 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 Baozun and Coupang LLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baozun Inc and Coupang LLC, you can compare the effects of market volatilities on Baozun and Coupang LLC 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 Baozun with a short position of Coupang LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baozun and Coupang LLC.
Diversification Opportunities for Baozun and Coupang LLC
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Baozun and Coupang is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Baozun Inc and Coupang LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coupang LLC and Baozun 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 Baozun Inc are associated (or correlated) with Coupang LLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coupang LLC has no effect on the direction of Baozun i.e., Baozun and Coupang LLC go up and down completely randomly.
Pair Corralation between Baozun and Coupang LLC
Given the investment horizon of 90 days Baozun Inc is expected to under-perform the Coupang LLC. In addition to that, Baozun is 1.77 times more volatile than Coupang LLC. It trades about -0.01 of its total potential returns per unit of risk. Coupang LLC is currently generating about 0.04 per unit of volatility. If you would invest 1,729 in Coupang LLC on September 4, 2024 and sell it today you would earn a total of 756.00 from holding Coupang LLC or generate 43.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baozun Inc vs. Coupang LLC
Performance |
| Timeline |
| Baozun Inc |
| Coupang LLC |
Baozun and Coupang LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baozun and Coupang LLC
The main advantage of trading using opposite Baozun and Coupang LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baozun position performs unexpectedly, Coupang LLC 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 Coupang LLC will offset losses from the drop in Coupang LLC's long position.| Baozun vs. PDD Holdings | Baozun vs. JD Inc Adr | Baozun vs. Global E Online | Baozun vs. Vipshop Holdings Limited |
| Coupang LLC vs. PDD Holdings | Coupang LLC vs. Alibaba Group Holding | Coupang LLC vs. Global E Online | Coupang LLC vs. Sea |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |