Correlation Between Etsy and 1stdibs

By analyzing existing cross correlation between Etsy Inc and 1stdibs, you can compare the effects of market volatilities on Etsy and 1stdibs 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 Etsy with a short position of 1stdibs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Etsy and 1stdibs.

Specify exactly 2 symbols:

Can any of the company-specific risk be diversified away by investing in both Etsy and 1stdibs 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 Etsy and 1stdibs into the same portfolio, which is an essential part of the fundamental portfolio management process.

Diversification Opportunities for Etsy and 1stdibs

-0.44
  Correlation Coefficient
Etsy Inc
1stdibs

Very good diversification

The 3 months correlation between Etsy and 1stdibs is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Etsy Inc and 1stdibs in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on 1stdibs and Etsy 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 Etsy Inc are associated (or correlated) with 1stdibs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1stdibs has no effect on the direction of Etsy i.e., Etsy and 1stdibs go up and down completely randomly.

Pair Corralation between Etsy and 1stdibs

Given the investment horizon of 90 days Etsy Inc is expected to generate 0.56 times more return on investment than 1stdibs. However, Etsy Inc is 1.8 times less risky than 1stdibs. It trades about 0.15 of its potential returns per unit of risk. 1stdibs is currently generating about 0.0 per unit of risk. If you would invest  19,080  in Etsy Inc on July 19, 2021 and sell it today you would earn a total of  3,029  from holding Etsy Inc or generate 15.88% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Etsy Inc  vs.  1stdibs

 Performance (%) 
      Timeline 
Etsy Inc 
 Etsy Performance
6 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Etsy Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Etsy showed solid returns over the last few months and may actually be approaching a breakup point.

Etsy Price Channel

1stdibs 
 1stdibs Performance
0 of 100
Over the last 90 days 1stdibs has generated negative risk-adjusted returns adding no value to investors with long positions. Even with fragile performance in the last few months, the Stock's fundamental drivers remain relatively invariable which may send shares a bit higher in November 2021. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

1stdibs Price Channel

Etsy and 1stdibs Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Etsy and 1stdibs

The main advantage of trading using opposite Etsy and 1stdibs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Etsy position performs unexpectedly, 1stdibs 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 1stdibs will offset losses from the drop in 1stdibs' long position.
The idea behind Etsy Inc and 1stdibs 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

Other Complementary Tools

CEO Directory
Screen CEOs from public companies around the world
Go
Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings
Go
Watchlist Optimization
Optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm
Go
Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Go
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Go
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Go
Money Managers
Screen money managers from public funds and ETFs managed around the world
Go
Piotroski F Score
Get Piotroski F Score based on binary analysis strategy of nine different fundamentals
Go
Financial Widgets
Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets
Go
Equity Valuation
Check real value of public entities based on technical and fundamental data
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go