Correlation Between FAST RETAIL and Sixt SE
Can any of the company-specific risk be diversified away by investing in both FAST RETAIL and Sixt SE 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 Sixt SE 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 Sixt SE, you can compare the effects of market volatilities on FAST RETAIL and Sixt SE 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 Sixt SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of FAST RETAIL and Sixt SE.
Diversification Opportunities for FAST RETAIL and Sixt SE
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between FAST and Sixt is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding FAST RETAIL ADR and Sixt SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sixt SE 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 Sixt SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sixt SE has no effect on the direction of FAST RETAIL i.e., FAST RETAIL and Sixt SE go up and down completely randomly.
Pair Corralation between FAST RETAIL and Sixt SE
Assuming the 90 days trading horizon FAST RETAIL ADR is expected to generate 1.0 times more return on investment than Sixt SE. However, FAST RETAIL ADR is 1.0 times less risky than Sixt SE. It trades about 0.07 of its potential returns per unit of risk. Sixt SE is currently generating about -0.01 per unit of risk. If you would invest 1,748 in FAST RETAIL ADR on October 13, 2024 and sell it today you would earn a total of 1,372 from holding FAST RETAIL ADR or generate 78.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FAST RETAIL ADR vs. Sixt SE
Performance |
| Timeline |
| FAST RETAIL ADR |
| Sixt SE |
FAST RETAIL and Sixt SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FAST RETAIL and Sixt SE
The main advantage of trading using opposite FAST RETAIL and Sixt SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FAST RETAIL position performs unexpectedly, Sixt SE 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 Sixt SE will offset losses from the drop in Sixt SE's long position.| FAST RETAIL vs. DELTA AIR LINES | FAST RETAIL vs. JD SPORTS FASH | FAST RETAIL vs. CHINA SOUTHN AIR H | FAST RETAIL vs. Altair Engineering |
| Sixt SE vs. FLOW TRADERS LTD | Sixt SE vs. Auto Trader Group | Sixt SE vs. Elmos Semiconductor SE | Sixt SE vs. FAST RETAIL ADR |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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