Correlation Between Kulicke and Baozun
Can any of the company-specific risk be diversified away by investing in both Kulicke and Baozun 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 Kulicke and Baozun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kulicke and Soffa and Baozun Inc, you can compare the effects of market volatilities on Kulicke and Baozun 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 Kulicke with a short position of Baozun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kulicke and Baozun.
Diversification Opportunities for Kulicke and Baozun
Average diversification
The 3 months correlation between Kulicke and Baozun is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Kulicke and Soffa and Baozun Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baozun Inc and Kulicke 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 Kulicke and Soffa are associated (or correlated) with Baozun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baozun Inc has no effect on the direction of Kulicke i.e., Kulicke and Baozun go up and down completely randomly.
Pair Corralation between Kulicke and Baozun
Given the investment horizon of 90 days Kulicke and Soffa is expected to generate 0.53 times more return on investment than Baozun. However, Kulicke and Soffa is 1.88 times less risky than Baozun. It trades about 0.21 of its potential returns per unit of risk. Baozun Inc is currently generating about -0.06 per unit of risk. If you would invest 4,592 in Kulicke and Soffa on September 4, 2024 and sell it today you would earn a total of 462.00 from holding Kulicke and Soffa or generate 10.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kulicke and Soffa vs. Baozun Inc
Performance |
| Timeline |
| Kulicke and Soffa |
| Baozun Inc |
Kulicke and Baozun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kulicke and Baozun
The main advantage of trading using opposite Kulicke and Baozun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kulicke position performs unexpectedly, Baozun 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 Baozun will offset losses from the drop in Baozun's long position.| Kulicke vs. NXP Semiconductors NV | Kulicke vs. Analog Devices | Kulicke vs. Monolithic Power Systems | Kulicke vs. ON Semiconductor |
| Baozun vs. PDD Holdings | Baozun vs. JD Inc Adr | Baozun vs. Global E Online | Baozun vs. Vipshop Holdings Limited |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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