Correlation Between Baozun and Columbia Disciplined
Can any of the company-specific risk be diversified away by investing in both Baozun and Columbia Disciplined 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 Baozun and Columbia Disciplined into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baozun Inc and Columbia Disciplined Value, you can compare the effects of market volatilities on Baozun and Columbia Disciplined 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 Baozun with a short position of Columbia Disciplined. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baozun and Columbia Disciplined.
Diversification Opportunities for Baozun and Columbia Disciplined
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Baozun and Columbia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Baozun Inc and Columbia Disciplined Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Disciplined and Baozun 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 Baozun Inc are associated (or correlated) with Columbia Disciplined. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Disciplined has no effect on the direction of Baozun i.e., Baozun and Columbia Disciplined go up and down completely randomly.
Pair Corralation between Baozun and Columbia Disciplined
If you would invest (100.00) in Columbia Disciplined Value on January 23, 2024 and sell it today you would earn a total of 100.00 from holding Columbia Disciplined Value or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Baozun Inc vs. Columbia Disciplined Value
Performance |
| Timeline |
| Baozun Inc |
| Columbia Disciplined |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Baozun and Columbia Disciplined Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baozun and Columbia Disciplined
The main advantage of trading using opposite Baozun and Columbia Disciplined positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baozun position performs unexpectedly, Columbia Disciplined 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 Columbia Disciplined will offset losses from the drop in Columbia Disciplined's long position.The idea behind Baozun Inc and Columbia Disciplined Value pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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