Correlation Between Floor Decor and Secoo Holding

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Can any of the company-specific risk be diversified away by investing in both Floor Decor and Secoo Holding 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 Floor Decor and Secoo Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Floor Decor Holdings and Secoo Holding, you can compare the effects of market volatilities on Floor Decor and Secoo Holding 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 Floor Decor with a short position of Secoo Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Floor Decor and Secoo Holding.

Diversification Opportunities for Floor Decor and Secoo Holding

0.3
  Correlation Coefficient

Weak diversification

The 3 months correlation between Floor and Secoo is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Floor Decor Holdings and Secoo Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Secoo Holding and Floor Decor 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 Floor Decor Holdings are associated (or correlated) with Secoo Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Secoo Holding has no effect on the direction of Floor Decor i.e., Floor Decor and Secoo Holding go up and down completely randomly.

Pair Corralation between Floor Decor and Secoo Holding

If you would invest  0.00  in Secoo Holding on March 6, 2024 and sell it today you would earn a total of  0.00  from holding Secoo Holding or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy4.76%
ValuesDaily Returns

Floor Decor Holdings  vs.  Secoo Holding

 Performance 
       Timeline  
Floor Decor Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Floor Decor Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Floor Decor is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.
Secoo Holding 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Secoo Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in July 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Floor Decor and Secoo Holding Volatility Contrast

   Predicted Return Density   
       Returns  
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