Correlation Between Vipshop Holdings and Buckle
Can any of the company-specific risk be diversified away by investing in both Vipshop Holdings and Buckle 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 Vipshop Holdings and Buckle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vipshop Holdings Limited and Buckle Inc, you can compare the effects of market volatilities on Vipshop Holdings and Buckle 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 Vipshop Holdings with a short position of Buckle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vipshop Holdings and Buckle.
Diversification Opportunities for Vipshop Holdings and Buckle
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vipshop and Buckle is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Vipshop Holdings Limited and Buckle Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Buckle Inc and Vipshop Holdings 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 Vipshop Holdings Limited are associated (or correlated) with Buckle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Buckle Inc has no effect on the direction of Vipshop Holdings i.e., Vipshop Holdings and Buckle go up and down completely randomly.
Pair Corralation between Vipshop Holdings and Buckle
Given the investment horizon of 90 days Vipshop Holdings Limited is expected to generate 1.91 times more return on investment than Buckle. However, Vipshop Holdings is 1.91 times more volatile than Buckle Inc. It trades about 0.07 of its potential returns per unit of risk. Buckle Inc is currently generating about -0.1 per unit of risk. If you would invest 1,374 in Vipshop Holdings Limited on October 31, 2024 and sell it today you would earn a total of 80.00 from holding Vipshop Holdings Limited or generate 5.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vipshop Holdings Limited vs. Buckle Inc
Performance |
| Timeline |
| Vipshop Holdings |
| Buckle Inc |
Vipshop Holdings and Buckle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vipshop Holdings and Buckle
The main advantage of trading using opposite Vipshop Holdings and Buckle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vipshop Holdings position performs unexpectedly, Buckle 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 Buckle will offset losses from the drop in Buckle's long position.| Vipshop Holdings vs. JD Inc Adr | Vipshop Holdings vs. Alibaba Group Holding | Vipshop Holdings vs. Sea | Vipshop Holdings vs. Jumia Technologies AG |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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