Correlation Between Rite Aid and Vipshop Holdings
Can any of the company-specific risk be diversified away by investing in both Rite Aid and Vipshop Holdings 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 Rite Aid and Vipshop Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rite Aid and Vipshop Holdings Limited, you can compare the effects of market volatilities on Rite Aid and Vipshop Holdings 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 Rite Aid with a short position of Vipshop Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rite Aid and Vipshop Holdings.
Diversification Opportunities for Rite Aid and Vipshop Holdings
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Rite and Vipshop is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Rite Aid and Vipshop Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vipshop Holdings and Rite Aid 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 Rite Aid are associated (or correlated) with Vipshop Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vipshop Holdings has no effect on the direction of Rite Aid i.e., Rite Aid and Vipshop Holdings go up and down completely randomly.
Pair Corralation between Rite Aid and Vipshop Holdings
If you would invest 17.00 in Rite Aid on January 20, 2024 and sell it today you would earn a total of 0.00 from holding Rite Aid or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Rite Aid vs. Vipshop Holdings Limited
Performance |
| Timeline |
| Rite Aid |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Vipshop Holdings |
Rite Aid and Vipshop Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rite Aid and Vipshop Holdings
The main advantage of trading using opposite Rite Aid and Vipshop Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rite Aid position performs unexpectedly, Vipshop Holdings 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 Vipshop Holdings will offset losses from the drop in Vipshop Holdings' long position.| Rite Aid vs. PetMed Express | Rite Aid vs. High Tide | Rite Aid vs. China Jo Jo Drugstores | Rite Aid vs. Bimi International Medical |
| Vipshop Holdings vs. Shoe Carnival | Vipshop Holdings vs. Hibbett Sports | Vipshop Holdings vs. Citi Trends | Vipshop Holdings vs. Zumiez Inc |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |