Correlation Between FAST RETAIL and Genesco
Can any of the company-specific risk be diversified away by investing in both FAST RETAIL and Genesco 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 FAST RETAIL and Genesco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FAST RETAIL ADR and Genesco, you can compare the effects of market volatilities on FAST RETAIL and Genesco 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 FAST RETAIL with a short position of Genesco. Check out your portfolio center. Please also check ongoing floating volatility patterns of FAST RETAIL and Genesco.
Diversification Opportunities for FAST RETAIL and Genesco
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FAST and Genesco is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding FAST RETAIL ADR and Genesco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesco and FAST RETAIL 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 FAST RETAIL ADR are associated (or correlated) with Genesco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesco has no effect on the direction of FAST RETAIL i.e., FAST RETAIL and Genesco go up and down completely randomly.
Pair Corralation between FAST RETAIL and Genesco
Assuming the 90 days trading horizon FAST RETAIL is expected to generate 5.67 times less return on investment than Genesco. But when comparing it to its historical volatility, FAST RETAIL ADR is 2.38 times less risky than Genesco. It trades about 0.18 of its potential returns per unit of risk. Genesco is currently generating about 0.43 of returns per unit of risk over similar time horizon. If you would invest 2,260 in Genesco on September 5, 2024 and sell it today you would earn a total of 1,080 from holding Genesco or generate 47.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
FAST RETAIL ADR vs. Genesco
Performance |
| Timeline |
| FAST RETAIL ADR |
| Genesco |
FAST RETAIL and Genesco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FAST RETAIL and Genesco
The main advantage of trading using opposite FAST RETAIL and Genesco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FAST RETAIL position performs unexpectedly, Genesco 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 Genesco will offset losses from the drop in Genesco's long position.| FAST RETAIL vs. CARSALESCOM | FAST RETAIL vs. Meiko Electronics Co | FAST RETAIL vs. ARROW ELECTRONICS | FAST RETAIL vs. UMC Electronics Co |
| Genesco vs. SHIP HEALTHCARE HLDGINC | Genesco vs. EPSILON HEALTHCARE LTD | Genesco vs. BOSTON BEER A | Genesco vs. CEOTRONICS |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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