Correlation Between COSCO SHIPPING and FAST RETAIL
Can any of the company-specific risk be diversified away by investing in both COSCO SHIPPING and FAST RETAIL 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 COSCO SHIPPING and FAST RETAIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COSCO SHIPPING Energy and FAST RETAIL ADR, you can compare the effects of market volatilities on COSCO SHIPPING and FAST RETAIL 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 COSCO SHIPPING with a short position of FAST RETAIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSCO SHIPPING and FAST RETAIL.
Diversification Opportunities for COSCO SHIPPING and FAST RETAIL
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between COSCO and FAST is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding COSCO SHIPPING Energy and FAST RETAIL ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FAST RETAIL ADR and COSCO SHIPPING 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 COSCO SHIPPING Energy are associated (or correlated) with FAST RETAIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FAST RETAIL ADR has no effect on the direction of COSCO SHIPPING i.e., COSCO SHIPPING and FAST RETAIL go up and down completely randomly.
Pair Corralation between COSCO SHIPPING and FAST RETAIL
Assuming the 90 days trading horizon COSCO SHIPPING Energy is expected to generate 2.24 times more return on investment than FAST RETAIL. However, COSCO SHIPPING is 2.24 times more volatile than FAST RETAIL ADR. It trades about 0.05 of its potential returns per unit of risk. FAST RETAIL ADR is currently generating about 0.07 per unit of risk. If you would invest 43.00 in COSCO SHIPPING Energy on September 12, 2024 and sell it today you would earn a total of 32.00 from holding COSCO SHIPPING Energy or generate 74.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COSCO SHIPPING Energy vs. FAST RETAIL ADR
Performance |
| Timeline |
| COSCO SHIPPING Energy |
| FAST RETAIL ADR |
COSCO SHIPPING and FAST RETAIL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COSCO SHIPPING and FAST RETAIL
The main advantage of trading using opposite COSCO SHIPPING and FAST RETAIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COSCO SHIPPING position performs unexpectedly, FAST RETAIL 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 FAST RETAIL will offset losses from the drop in FAST RETAIL's long position.| COSCO SHIPPING vs. FAST RETAIL ADR | COSCO SHIPPING vs. Transportadora de Gas | COSCO SHIPPING vs. Tradeweb Markets | COSCO SHIPPING vs. CANON MARKETING JP |
| FAST RETAIL vs. CCC SA | FAST RETAIL vs. AOYAMA TRADING | FAST RETAIL vs. Superior Plus Corp | FAST RETAIL vs. SIVERS SEMICONDUCTORS AB |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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