Correlation Between Farfetch and Kidpik Corp
Can any of the company-specific risk be diversified away by investing in both Farfetch and Kidpik Corp 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 Kidpik Corp 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 Kidpik Corp, you can compare the effects of market volatilities on Farfetch and Kidpik Corp 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 Kidpik Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Farfetch and Kidpik Corp.
Diversification Opportunities for Farfetch and Kidpik Corp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Farfetch and Kidpik is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Farfetch Ltd Class and Kidpik Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kidpik Corp 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 Kidpik Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kidpik Corp has no effect on the direction of Farfetch i.e., Farfetch and Kidpik Corp go up and down completely randomly.
Pair Corralation between Farfetch and Kidpik Corp
If you would invest (100.00) in Farfetch Ltd Class on November 9, 2024 and sell it today you would earn a total of 100.00 from holding Farfetch Ltd Class or generate -100.0% 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. Kidpik Corp
Performance |
Timeline |
Farfetch Class |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Kidpik Corp |
Farfetch and Kidpik Corp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Farfetch and Kidpik Corp
The main advantage of trading using opposite Farfetch and Kidpik Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farfetch position performs unexpectedly, Kidpik Corp 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 Kidpik Corp will offset losses from the drop in Kidpik Corp's long position.Farfetch vs. JD Inc Adr | Farfetch vs. Alibaba Group Holding | Farfetch vs. Sea | Farfetch vs. Vipshop Holdings Limited |
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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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