Correlation Between Vipshop Holdings and ThredUp
Can any of the company-specific risk be diversified away by investing in both Vipshop Holdings and ThredUp 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 ThredUp 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 ThredUp, you can compare the effects of market volatilities on Vipshop Holdings and ThredUp 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 ThredUp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vipshop Holdings and ThredUp.
Diversification Opportunities for Vipshop Holdings and ThredUp
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vipshop and ThredUp is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Vipshop Holdings Limited and ThredUp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ThredUp 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 ThredUp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ThredUp has no effect on the direction of Vipshop Holdings i.e., Vipshop Holdings and ThredUp go up and down completely randomly.
Pair Corralation between Vipshop Holdings and ThredUp
Given the investment horizon of 90 days Vipshop Holdings Limited is expected to under-perform the ThredUp. But the stock apears to be less risky and, when comparing its historical volatility, Vipshop Holdings Limited is 3.1 times less risky than ThredUp. The stock trades about -0.03 of its potential returns per unit of risk. The ThredUp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 198.00 in ThredUp on September 1, 2024 and sell it today you would lose (25.00) from holding ThredUp or give up 12.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vipshop Holdings Limited vs. ThredUp
Performance |
| Timeline |
| Vipshop Holdings |
| ThredUp |
Vipshop Holdings and ThredUp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vipshop Holdings and ThredUp
The main advantage of trading using opposite Vipshop Holdings and ThredUp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vipshop Holdings position performs unexpectedly, ThredUp 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 ThredUp will offset losses from the drop in ThredUp's long position.| Vipshop Holdings vs. PDD Holdings | Vipshop Holdings vs. JD Inc Adr | Vipshop Holdings vs. Alibaba Group Holding | Vipshop Holdings vs. Sea |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |