Correlation Between Baozun and Phonex
Can any of the company-specific risk be diversified away by investing in both Baozun and Phonex 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 Phonex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baozun Inc and Phonex Inc, you can compare the effects of market volatilities on Baozun and Phonex 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 Phonex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baozun and Phonex.
Diversification Opportunities for Baozun and Phonex
Very good diversification
The 3 months correlation between Baozun and Phonex is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Baozun Inc and Phonex Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phonex Inc 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 Phonex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phonex Inc has no effect on the direction of Baozun i.e., Baozun and Phonex go up and down completely randomly.
Pair Corralation between Baozun and Phonex
Given the investment horizon of 90 days Baozun Inc is expected to under-perform the Phonex. But the stock apears to be less risky and, when comparing its historical volatility, Baozun Inc is 1.09 times less risky than Phonex. The stock trades about -0.22 of its potential returns per unit of risk. The Phonex Inc is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 115.00 in Phonex Inc on September 1, 2024 and sell it today you would lose (5.00) from holding Phonex Inc or give up 4.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baozun Inc vs. Phonex Inc
Performance |
| Timeline |
| Baozun Inc |
| Phonex Inc |
Baozun and Phonex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baozun and Phonex
The main advantage of trading using opposite Baozun and Phonex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baozun position performs unexpectedly, Phonex 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 Phonex will offset losses from the drop in Phonex's long position.| Baozun vs. PDD Holdings | Baozun vs. JD Inc Adr | Baozun vs. Global E Online | Baozun vs. Vipshop Holdings Limited |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| 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 | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |