Correlation Between NFT and Baozun
Can any of the company-specific risk be diversified away by investing in both NFT 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 NFT and Baozun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NFT Limited and Baozun Inc, you can compare the effects of market volatilities on NFT 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 NFT with a short position of Baozun. Check out your portfolio center. Please also check ongoing floating volatility patterns of NFT and Baozun.
Diversification Opportunities for NFT and Baozun
Poor diversification
The 3 months correlation between NFT and Baozun is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding NFT Limited and Baozun Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baozun Inc and NFT 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 NFT Limited 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 NFT i.e., NFT and Baozun go up and down completely randomly.
Pair Corralation between NFT and Baozun
Allowing for the 90-day total investment horizon NFT Limited is expected to generate 5.06 times more return on investment than Baozun. However, NFT is 5.06 times more volatile than Baozun Inc. It trades about -0.05 of its potential returns per unit of risk. Baozun Inc is currently generating about -0.31 per unit of risk. If you would invest 831.00 in NFT Limited on August 28, 2024 and sell it today you would lose (443.00) from holding NFT Limited or give up 53.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NFT Limited vs. Baozun Inc
Performance |
| Timeline |
| NFT Limited |
| Baozun Inc |
NFT and Baozun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NFT and Baozun
The main advantage of trading using opposite NFT and Baozun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NFT 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.| NFT vs. Freedom Bank of | NFT vs. Commonwealth Bank of | NFT vs. Juniata Valley Financial | NFT vs. Summa Silver Corp |
| 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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