Correlation Between Kidpik Corp and Revolve Group
Can any of the company-specific risk be diversified away by investing in both Kidpik Corp and Revolve Group 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 Revolve Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kidpik Corp and Revolve Group LLC, you can compare the effects of market volatilities on Kidpik Corp and Revolve Group 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 Revolve Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kidpik Corp and Revolve Group.
Diversification Opportunities for Kidpik Corp and Revolve Group
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kidpik and Revolve is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Kidpik Corp and Revolve Group LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Revolve Group LLC 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 Revolve Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Revolve Group LLC has no effect on the direction of Kidpik Corp i.e., Kidpik Corp and Revolve Group go up and down completely randomly.
Pair Corralation between Kidpik Corp and Revolve Group
Considering the 90-day investment horizon Kidpik Corp is expected to generate 1.65 times less return on investment than Revolve Group. In addition to that, Kidpik Corp is 2.03 times more volatile than Revolve Group LLC. It trades about 0.02 of its total potential returns per unit of risk. Revolve Group LLC is currently generating about 0.06 per unit of volatility. If you would invest 1,933 in Revolve Group LLC on September 12, 2024 and sell it today you would earn a total of 1,634 from holding Revolve Group LLC or generate 84.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kidpik Corp vs. Revolve Group LLC
Performance |
| Timeline |
| Kidpik Corp |
| Revolve Group LLC |
Kidpik Corp and Revolve Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kidpik Corp and Revolve Group
The main advantage of trading using opposite Kidpik Corp and Revolve Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kidpik Corp position performs unexpectedly, Revolve Group 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 Revolve Group will offset losses from the drop in Revolve Group's long position.| Kidpik Corp vs. Hour Loop | Kidpik Corp vs. MOGU Inc | Kidpik Corp vs. Jowell Global | Kidpik Corp vs. Qurate Retail Series |
| Revolve Group vs. Hour Loop | Revolve Group vs. Kidpik Corp | Revolve Group vs. MOGU Inc | Revolve Group vs. Jowell Global |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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