Correlation Between ZALANDO SE and Overstockcom
Can any of the company-specific risk be diversified away by investing in both ZALANDO SE and Overstockcom 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 ZALANDO SE and Overstockcom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZALANDO SE ADR and Overstockcom, you can compare the effects of market volatilities on ZALANDO SE and Overstockcom 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 ZALANDO SE with a short position of Overstockcom. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZALANDO SE and Overstockcom.
Diversification Opportunities for ZALANDO SE and Overstockcom
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between ZALANDO and Overstockcom is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding ZALANDO SE ADR and Overstockcom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Overstockcom and ZALANDO SE 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 ZALANDO SE ADR are associated (or correlated) with Overstockcom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Overstockcom has no effect on the direction of ZALANDO SE i.e., ZALANDO SE and Overstockcom go up and down completely randomly.
Pair Corralation between ZALANDO SE and Overstockcom
If you would invest 1,496 in ZALANDO SE ADR on September 1, 2024 and sell it today you would earn a total of 55.00 from holding ZALANDO SE ADR or generate 3.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
ZALANDO SE ADR vs. Overstockcom
Performance |
| Timeline |
| ZALANDO SE ADR |
| Overstockcom |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ZALANDO SE and Overstockcom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZALANDO SE and Overstockcom
The main advantage of trading using opposite ZALANDO SE and Overstockcom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZALANDO SE position performs unexpectedly, Overstockcom 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 Overstockcom will offset losses from the drop in Overstockcom's long position.| ZALANDO SE vs. PDD Holdings | ZALANDO SE vs. JD Inc Adr | ZALANDO SE vs. Baozun Inc | ZALANDO SE vs. Global E Online |
| Overstockcom vs. Etsy Inc | Overstockcom vs. Chewy Inc | Overstockcom vs. PDD Holdings | Overstockcom 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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