Correlation Between Miniso Group and Gap,

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

By analyzing existing cross correlation between Miniso Group Holding and The Gap,, you can compare the effects of market volatilities on Miniso Group and Gap, 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 Miniso Group with a short position of Gap,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Miniso Group and Gap,.

Diversification Opportunities for Miniso Group and Gap,

0.64

Correlation Coefficient

Miniso Group  Gap,

Poor diversification

The 3 months correlation between Miniso and Gap, is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Miniso Group Holding and The Gap, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gap, and Miniso Group 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 Miniso Group Holding are associated (or correlated) with Gap,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gap, has no effect on the direction of Miniso Group i.e., Miniso Group and Gap, go up and down completely randomly.

Pair Corralation between Miniso Group and Gap,

Given the investment horizon of 90 days Miniso Group is expected to generate 1.78 times less return on investment than Gap,. In addition to that, Miniso Group is 1.08 times more volatile than The Gap,. It trades about 0.04 of its total potential returns per unit of risk. The Gap, is currently generating about 0.09 per unit of volatility. If you would invest  919.00  in The Gap, on October 3, 2024 and sell it today you would earn a total of  1,444  from holding The Gap, or generate 157.13% return on investment over 90 days.

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

Miniso Group Holding  vs.  The Gap,

Miniso Group Holding

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Miniso Group Holding are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, Miniso Group displayed solid returns over the last few months and may actually be approaching a breakup point.

Gap,

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in The Gap, are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Gap, reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Miniso Group and Gap,

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

The idea behind Miniso Group Holding and The Gap, 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.