Correlation Between Onxeo SA and Stitch Fix

Can any of the company-specific risk be diversified away by investing in both Onxeo SA and Stitch Fix 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 Onxeo SA and Stitch Fix into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Onxeo SA and Stitch Fix, you can compare the effects of market volatilities on Onxeo SA and Stitch Fix 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 Onxeo SA with a short position of Stitch Fix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Onxeo SA and Stitch Fix.

Diversification Opportunities for Onxeo SA and Stitch Fix

-0.6

Correlation Coefficient

Onxeo SA  Stitch Fix

Excellent diversification

The 3 months correlation between Onxeo and Stitch is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Onxeo SA and Stitch Fix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stitch Fix and Onxeo SA 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 Onxeo SA are associated (or correlated) with Stitch Fix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stitch Fix has no effect on the direction of Onxeo SA i.e., Onxeo SA and Stitch Fix go up and down completely randomly.

Pair Corralation between Onxeo SA and Stitch Fix

Assuming the 90 days horizon Onxeo SA is expected to generate 5.08 times less return on investment than Stitch Fix. In addition to that, Onxeo SA is 1.13 times more volatile than Stitch Fix. It trades about 0.03 of its total potential returns per unit of risk. Stitch Fix is currently generating about 0.15 per unit of volatility. If you would invest  347.00  in Stitch Fix on September 13, 2024 and sell it today you would earn a total of  282.00  from holding Stitch Fix or generate 81.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Onxeo SA  vs.  Stitch Fix

Onxeo SA

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Onxeo SA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Onxeo SA reported solid returns over the last few months and may actually be approaching a breakup point.

Stitch Fix

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Stitch Fix are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Stitch Fix reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Onxeo SA and Stitch Fix

The main advantage of trading using opposite Onxeo SA and Stitch Fix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Onxeo SA position performs unexpectedly, Stitch Fix 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 Stitch Fix will offset losses from the drop in Stitch Fix's long position.

The idea behind Onxeo SA and Stitch Fix 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.

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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.