Correlation Between 1StdibsCom and GigaCloud Technology
Can any of the company-specific risk be diversified away by investing in both 1StdibsCom and GigaCloud Technology 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 GigaCloud Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1StdibsCom and GigaCloud Technology Class, you can compare the effects of market volatilities on 1StdibsCom and GigaCloud Technology 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 GigaCloud Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1StdibsCom and GigaCloud Technology.
Diversification Opportunities for 1StdibsCom and GigaCloud Technology
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 1StdibsCom and GigaCloud is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding 1StdibsCom and GigaCloud Technology Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GigaCloud Technology 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 GigaCloud Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GigaCloud Technology has no effect on the direction of 1StdibsCom i.e., 1StdibsCom and GigaCloud Technology go up and down completely randomly.
Pair Corralation between 1StdibsCom and GigaCloud Technology
Given the investment horizon of 90 days 1StdibsCom is expected to under-perform the GigaCloud Technology. But the stock apears to be less risky and, when comparing its historical volatility, 1StdibsCom is 2.6 times less risky than GigaCloud Technology. The stock trades about -0.14 of its potential returns per unit of risk. The GigaCloud Technology Class is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,417 in GigaCloud Technology Class on August 26, 2024 and sell it today you would earn a total of 133.00 from holding GigaCloud Technology Class or generate 5.5% 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. GigaCloud Technology Class
Performance |
| Timeline |
| 1StdibsCom |
| GigaCloud Technology |
1StdibsCom and GigaCloud Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 1StdibsCom and GigaCloud Technology
The main advantage of trading using opposite 1StdibsCom and GigaCloud Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1StdibsCom position performs unexpectedly, GigaCloud Technology 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 GigaCloud Technology will offset losses from the drop in GigaCloud Technology's long position.| 1StdibsCom vs. Sea | 1StdibsCom vs. Wayfair | 1StdibsCom vs. Chewy Inc | 1StdibsCom vs. Vipshop Holdings Limited |
| GigaCloud Technology vs. Steven Madden | GigaCloud Technology vs. Vera Bradley | GigaCloud Technology vs. Caleres | GigaCloud Technology vs. Rocky Brands |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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