Correlation Between BJs Wholesale and Zovio
Can any of the company-specific risk be diversified away by investing in both BJs Wholesale and Zovio 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 BJs Wholesale and Zovio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Wholesale Club and Zovio Inc, you can compare the effects of market volatilities on BJs Wholesale and Zovio 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 BJs Wholesale with a short position of Zovio. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Wholesale and Zovio.
Diversification Opportunities for BJs Wholesale and Zovio
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BJs and Zovio is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding BJs Wholesale Club and Zovio Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zovio Inc and BJs Wholesale 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 BJs Wholesale Club are associated (or correlated) with Zovio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zovio Inc has no effect on the direction of BJs Wholesale i.e., BJs Wholesale and Zovio go up and down completely randomly.
Pair Corralation between BJs Wholesale and Zovio
Allowing for the 90-day total investment horizon BJs Wholesale is expected to generate 37.48 times less return on investment than Zovio. But when comparing it to its historical volatility, BJs Wholesale Club is 16.41 times less risky than Zovio. It trades about 0.05 of its potential returns per unit of risk. Zovio Inc is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 0.80 in Zovio Inc on August 30, 2024 and sell it today you would earn a total of 0.10 from holding Zovio Inc or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 7.86% |
| Values | Daily Returns |
BJs Wholesale Club vs. Zovio Inc
Performance |
| Timeline |
| BJs Wholesale Club |
| Zovio Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
BJs Wholesale and Zovio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Wholesale and Zovio
The main advantage of trading using opposite BJs Wholesale and Zovio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Wholesale position performs unexpectedly, Zovio 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 Zovio will offset losses from the drop in Zovio's long position.| BJs Wholesale vs. Dollar Tree | BJs Wholesale vs. Dicks Sporting Goods | BJs Wholesale vs. Williams Sonoma | BJs Wholesale vs. Dillards |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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