Correlation Between Farfetch and Natural Health
Can any of the company-specific risk be diversified away by investing in both Farfetch and Natural Health 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 Natural Health 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 Natural Health Trend, you can compare the effects of market volatilities on Farfetch and Natural Health 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 Natural Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Farfetch and Natural Health.
Diversification Opportunities for Farfetch and Natural Health
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Farfetch and Natural is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Farfetch Ltd Class and Natural Health Trend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natural Health Trend 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 Natural Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natural Health Trend has no effect on the direction of Farfetch i.e., Farfetch and Natural Health go up and down completely randomly.
Pair Corralation between Farfetch and Natural Health
If you would invest 464.00 in Natural Health Trend on November 9, 2024 and sell it today you would earn a total of 57.00 from holding Natural Health Trend or generate 12.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Farfetch Ltd Class vs. Natural Health Trend
Performance |
| Timeline |
| Farfetch Class |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Natural Health Trend |
Farfetch and Natural Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Farfetch and Natural Health
The main advantage of trading using opposite Farfetch and Natural Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farfetch position performs unexpectedly, Natural Health 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 Natural Health will offset losses from the drop in Natural Health's long position.| Farfetch vs. JD Inc Adr | Farfetch vs. Alibaba Group Holding | Farfetch vs. Sea | Farfetch vs. Vipshop Holdings Limited |
| Natural Health vs. Liquidity Services | Natural Health vs. Hour Loop | Natural Health vs. Qurate Retail Series | Natural Health vs. Emerge Commerce |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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