Correlation Between Fast Retailing and Kering SA
Can any of the company-specific risk be diversified away by investing in both Fast Retailing and Kering SA 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 Fast Retailing and Kering SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fast Retailing Co and Kering SA, you can compare the effects of market volatilities on Fast Retailing and Kering SA 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 Fast Retailing with a short position of Kering SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fast Retailing and Kering SA.
Diversification Opportunities for Fast Retailing and Kering SA
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fast and Kering is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Fast Retailing Co and Kering SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kering SA and Fast Retailing 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 Fast Retailing Co are associated (or correlated) with Kering SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kering SA has no effect on the direction of Fast Retailing i.e., Fast Retailing and Kering SA go up and down completely randomly.
Pair Corralation between Fast Retailing and Kering SA
Assuming the 90 days horizon Fast Retailing Co is expected to under-perform the Kering SA. But the pink sheet apears to be less risky and, when comparing its historical volatility, Fast Retailing Co is 1.44 times less risky than Kering SA. The pink sheet trades about -0.01 of its potential returns per unit of risk. The Kering SA is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,995 in Kering SA on May 3, 2025 and sell it today you would earn a total of 480.00 from holding Kering SA or generate 24.06% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Fast Retailing Co vs. Kering SA
Performance |
Timeline |
Fast Retailing |
Kering SA |
Fast Retailing and Kering SA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fast Retailing and Kering SA
The main advantage of trading using opposite Fast Retailing and Kering SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fast Retailing position performs unexpectedly, Kering SA 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 Kering SA will offset losses from the drop in Kering SA's long position.Fast Retailing vs. Aritzia | Fast Retailing vs. Boozt AB | Fast Retailing vs. Citi Trends | Fast Retailing vs. Fast Retailing Co |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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