Correlation Between Overstockcom and Kidpik Corp
Can any of the company-specific risk be diversified away by investing in both Overstockcom and Kidpik Corp 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 Overstockcom and Kidpik Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Overstockcom and Kidpik Corp, you can compare the effects of market volatilities on Overstockcom and Kidpik Corp 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 Overstockcom with a short position of Kidpik Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Overstockcom and Kidpik Corp.
Diversification Opportunities for Overstockcom and Kidpik Corp
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Overstockcom and Kidpik is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Overstockcom and Kidpik Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kidpik Corp and Overstockcom 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 Overstockcom are associated (or correlated) with Kidpik Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kidpik Corp has no effect on the direction of Overstockcom i.e., Overstockcom and Kidpik Corp go up and down completely randomly.
Pair Corralation between Overstockcom and Kidpik Corp
If you would invest 237.00 in Kidpik Corp on September 1, 2024 and sell it today you would lose (10.00) from holding Kidpik Corp or give up 4.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Overstockcom vs. Kidpik Corp
Performance |
| Timeline |
| Overstockcom |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Kidpik Corp |
Overstockcom and Kidpik Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Overstockcom and Kidpik Corp
The main advantage of trading using opposite Overstockcom and Kidpik Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Overstockcom position performs unexpectedly, Kidpik Corp 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 Kidpik Corp will offset losses from the drop in Kidpik Corp's long position.| Overstockcom vs. Etsy Inc | Overstockcom vs. Chewy Inc | Overstockcom vs. PDD Holdings | Overstockcom vs. Sea |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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