Correlation Between Farfetch and Jumia Technologies
Can any of the company-specific risk be diversified away by investing in both Farfetch and Jumia Technologies 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 Farfetch and Jumia Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Farfetch Ltd Class and Jumia Technologies AG, you can compare the effects of market volatilities on Farfetch and Jumia Technologies 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 Farfetch with a short position of Jumia Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Farfetch and Jumia Technologies.
Diversification Opportunities for Farfetch and Jumia Technologies
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Farfetch and Jumia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Farfetch Ltd Class and Jumia Technologies AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jumia Technologies and Farfetch 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 Farfetch Ltd Class are associated (or correlated) with Jumia Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jumia Technologies has no effect on the direction of Farfetch i.e., Farfetch and Jumia Technologies go up and down completely randomly.
Pair Corralation between Farfetch and Jumia Technologies
Given the investment horizon of 90 days Farfetch is expected to generate 4.92 times less return on investment than Jumia Technologies. But when comparing it to its historical volatility, Farfetch Ltd Class is 1.37 times less risky than Jumia Technologies. It trades about 0.01 of its potential returns per unit of risk. Jumia Technologies AG is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 377.00 in Jumia Technologies AG on November 2, 2024 and sell it today you would earn a total of 44.00 from holding Jumia Technologies AG or generate 11.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 22.67% |
| Values | Daily Returns |
Farfetch Ltd Class vs. Jumia Technologies AG
Performance |
| Timeline |
| Farfetch Class |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Jumia Technologies |
Farfetch and Jumia Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Farfetch and Jumia Technologies
The main advantage of trading using opposite Farfetch and Jumia Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farfetch position performs unexpectedly, Jumia Technologies 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 Jumia Technologies will offset losses from the drop in Jumia Technologies' long position.| Farfetch vs. JD Inc Adr | Farfetch vs. Alibaba Group Holding | Farfetch vs. Sea | Farfetch vs. Vipshop Holdings Limited |
| Jumia Technologies vs. Sea | Jumia Technologies vs. MercadoLibre | Jumia Technologies vs. PDD Holdings | Jumia Technologies vs. JD Inc 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |