Correlation Between Figs and Fossil
Can any of the company-specific risk be diversified away by investing in both Figs and Fossil 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 Figs and Fossil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Figs Inc and Fossil Group, you can compare the effects of market volatilities on Figs and Fossil 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 Figs with a short position of Fossil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Figs and Fossil.
Diversification Opportunities for Figs and Fossil
Good diversification
The 3 months correlation between Figs and Fossil is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Figs Inc and Fossil Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fossil Group and Figs 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 Figs Inc are associated (or correlated) with Fossil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fossil Group has no effect on the direction of Figs i.e., Figs and Fossil go up and down completely randomly.
Pair Corralation between Figs and Fossil
Given the investment horizon of 90 days Figs Inc is expected to under-perform the Fossil. In addition to that, Figs is 1.26 times more volatile than Fossil Group. It trades about -0.09 of its total potential returns per unit of risk. Fossil Group is currently generating about 0.14 per unit of volatility. If you would invest 128.00 in Fossil Group on September 2, 2024 and sell it today you would earn a total of 18.00 from holding Fossil Group or generate 14.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Figs Inc vs. Fossil Group
Performance |
| Timeline |
| Figs Inc |
| Fossil Group |
Figs and Fossil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Figs and Fossil
The main advantage of trading using opposite Figs and Fossil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Figs position performs unexpectedly, Fossil 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 Fossil will offset losses from the drop in Fossil's long position.The idea behind Figs Inc and Fossil Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Fossil vs. Lanvin Group Holdings | Fossil vs. Signet Jewelers | Fossil vs. Tapestry | Fossil vs. Capri Holdings |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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