Correlation Between Foot Locker and Funko
Can any of the company-specific risk be diversified away by investing in both Foot Locker and Funko 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 Foot Locker and Funko into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Foot Locker and Funko Inc, you can compare the effects of market volatilities on Foot Locker and Funko 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 Foot Locker with a short position of Funko. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foot Locker and Funko.
Diversification Opportunities for Foot Locker and Funko
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Foot and Funko is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Foot Locker and Funko Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Funko Inc and Foot Locker 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 Foot Locker are associated (or correlated) with Funko. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Funko Inc has no effect on the direction of Foot Locker i.e., Foot Locker and Funko go up and down completely randomly.
Pair Corralation between Foot Locker and Funko
Allowing for the 90-day total investment horizon Foot Locker is expected to under-perform the Funko. In addition to that, Foot Locker is 1.01 times more volatile than Funko Inc. It trades about 0.0 of its total potential returns per unit of risk. Funko Inc is currently generating about 0.02 per unit of volatility. If you would invest 1,038 in Funko Inc on August 27, 2024 and sell it today you would earn a total of 23.00 from holding Funko Inc or generate 2.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Foot Locker vs. Funko Inc
Performance |
| Timeline |
| Foot Locker |
| Funko Inc |
Foot Locker and Funko Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Foot Locker and Funko
The main advantage of trading using opposite Foot Locker and Funko positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Foot Locker position performs unexpectedly, Funko 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 Funko will offset losses from the drop in Funko's long position.| Foot Locker vs. Abercrombie Fitch | Foot Locker vs. Urban Outfitters | Foot Locker vs. Childrens Place | Foot Locker vs. American Eagle Outfitters |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| 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 |