Correlation Between 1StdibsCom and Coupang LLC
Can any of the company-specific risk be diversified away by investing in both 1StdibsCom 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 1StdibsCom and Coupang LLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1StdibsCom and Coupang LLC, you can compare the effects of market volatilities on 1StdibsCom 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 1StdibsCom with a short position of Coupang LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1StdibsCom and Coupang LLC.
Diversification Opportunities for 1StdibsCom and Coupang LLC
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 1StdibsCom and Coupang is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding 1StdibsCom and Coupang LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coupang LLC and 1StdibsCom 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 1StdibsCom 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 1StdibsCom i.e., 1StdibsCom and Coupang LLC go up and down completely randomly.
Pair Corralation between 1StdibsCom and Coupang LLC
Given the investment horizon of 90 days 1StdibsCom is expected to under-perform the Coupang LLC. In addition to that, 1StdibsCom is 1.16 times more volatile than Coupang LLC. It trades about -0.02 of its total potential returns per unit of risk. Coupang LLC is currently generating about 0.03 per unit of volatility. If you would invest 1,963 in Coupang LLC on August 23, 2024 and sell it today you would earn a total of 434.00 from holding Coupang LLC or generate 22.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
1StdibsCom vs. Coupang LLC
Performance |
| Timeline |
| 1StdibsCom |
| Coupang LLC |
1StdibsCom and Coupang LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 1StdibsCom and Coupang LLC
The main advantage of trading using opposite 1StdibsCom and Coupang LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1StdibsCom 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.| 1StdibsCom vs. Hour Loop | 1StdibsCom vs. Liquidity Services | 1StdibsCom vs. Qurate Retail Series | 1StdibsCom vs. Emerge Commerce |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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