Correlation Between Strix Group and Coupang
Can any of the company-specific risk be diversified away by investing in both Strix Group and Coupang 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 Strix Group and Coupang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strix Group Plc and Coupang, you can compare the effects of market volatilities on Strix Group and Coupang 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 Strix Group with a short position of Coupang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strix Group and Coupang.
Diversification Opportunities for Strix Group and Coupang
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Strix and Coupang is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Strix Group Plc and Coupang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coupang and Strix Group 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 Strix Group Plc are associated (or correlated) with Coupang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coupang has no effect on the direction of Strix Group i.e., Strix Group and Coupang go up and down completely randomly.
Pair Corralation between Strix Group and Coupang
Assuming the 90 days horizon Strix Group Plc is expected to generate 1.07 times more return on investment than Coupang. However, Strix Group is 1.07 times more volatile than Coupang. It trades about -0.01 of its potential returns per unit of risk. Coupang is currently generating about -0.03 per unit of risk. If you would invest 71.00 in Strix Group Plc on August 28, 2024 and sell it today you would lose (1.00) from holding Strix Group Plc or give up 1.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Strix Group Plc vs. Coupang
Performance |
| Timeline |
| Strix Group Plc |
| Coupang |
Strix Group and Coupang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strix Group and Coupang
The main advantage of trading using opposite Strix Group and Coupang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strix Group position performs unexpectedly, Coupang 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 Coupang will offset losses from the drop in Coupang's long position.| Strix Group vs. Japan Tobacco | Strix Group vs. Transport International Holdings | Strix Group vs. Taiwan Semiconductor Manufacturing | Strix Group vs. UPDATE SOFTWARE |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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