Correlation Between AKA Brands and ATRenew
Can any of the company-specific risk be diversified away by investing in both AKA Brands and ATRenew 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 AKA Brands and ATRenew into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKA Brands Holding and ATRenew Inc DRC, you can compare the effects of market volatilities on AKA Brands and ATRenew 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 AKA Brands with a short position of ATRenew. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKA Brands and ATRenew.
Diversification Opportunities for AKA Brands and ATRenew
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AKA and ATRenew is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding AKA Brands Holding and ATRenew Inc DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATRenew Inc DRC and AKA Brands 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 AKA Brands Holding are associated (or correlated) with ATRenew. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATRenew Inc DRC has no effect on the direction of AKA Brands i.e., AKA Brands and ATRenew go up and down completely randomly.
Pair Corralation between AKA Brands and ATRenew
Considering the 90-day investment horizon AKA Brands Holding is expected to under-perform the ATRenew. In addition to that, AKA Brands is 1.31 times more volatile than ATRenew Inc DRC. It trades about -0.12 of its total potential returns per unit of risk. ATRenew Inc DRC is currently generating about 0.11 per unit of volatility. If you would invest 262.00 in ATRenew Inc DRC on August 27, 2024 and sell it today you would earn a total of 21.00 from holding ATRenew Inc DRC or generate 8.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AKA Brands Holding vs. ATRenew Inc DRC
Performance |
| Timeline |
| AKA Brands Holding |
| ATRenew Inc DRC |
AKA Brands and ATRenew Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKA Brands and ATRenew
The main advantage of trading using opposite AKA Brands and ATRenew positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKA Brands position performs unexpectedly, ATRenew 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 ATRenew will offset losses from the drop in ATRenew's long position.| AKA Brands vs. Brilliant Earth Group | AKA Brands vs. Lulus Fashion Lounge | AKA Brands vs. Torrid Holdings | AKA Brands vs. Aveanna Healthcare Holdings |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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