Correlation Between Kidpik Corp and Fossil
Can any of the company-specific risk be diversified away by investing in both Kidpik Corp and Fossil 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 Kidpik Corp and Fossil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kidpik Corp and Fossil Group, you can compare the effects of market volatilities on Kidpik Corp and Fossil 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 Kidpik Corp with a short position of Fossil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kidpik Corp and Fossil.
Diversification Opportunities for Kidpik Corp and Fossil
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kidpik and Fossil is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Kidpik Corp and Fossil Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fossil Group and Kidpik Corp 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 Kidpik Corp are associated (or correlated) with Fossil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fossil Group has no effect on the direction of Kidpik Corp i.e., Kidpik Corp and Fossil go up and down completely randomly.
Pair Corralation between Kidpik Corp and Fossil
Considering the 90-day investment horizon Kidpik Corp is expected to under-perform the Fossil. In addition to that, Kidpik Corp is 1.14 times more volatile than Fossil Group. It trades about -0.07 of its total potential returns per unit of risk. Fossil Group is currently generating about 0.14 per unit of volatility. If you would invest 128.00 in Fossil Group on September 2, 2024 and sell it today you would earn a total of 18.00 from holding Fossil Group or generate 14.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kidpik Corp vs. Fossil Group
Performance |
| Timeline |
| Kidpik Corp |
| Fossil Group |
Kidpik Corp and Fossil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kidpik Corp and Fossil
The main advantage of trading using opposite Kidpik Corp and Fossil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kidpik Corp position performs unexpectedly, Fossil 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 Fossil will offset losses from the drop in Fossil's long position.| Kidpik Corp vs. Qurate Retail Series | Kidpik Corp vs. Natural Health Trend | Kidpik Corp vs. Liquidity Services | Kidpik Corp vs. Qurate Retail |
| Fossil vs. Lanvin Group Holdings | Fossil vs. Signet Jewelers | Fossil vs. Tapestry | Fossil vs. Capri 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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