Correlation Between Ross Stores and PICKN PAY

Can any of the company-specific risk be diversified away by investing in both Ross Stores and PICKN PAY 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 Ross Stores and PICKN PAY into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ross Stores and PICKN PAY STORES, you can compare the effects of market volatilities on Ross Stores and PICKN PAY 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 Ross Stores with a short position of PICKN PAY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and PICKN PAY.

Diversification Opportunities for Ross Stores and PICKN PAY

0.42

Correlation Coefficient

Ross Stores  PICKN PAY

Very weak diversification

The 3 months correlation between Ross and PICKN is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and PICKN PAY STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PICKN PAY STORES and Ross Stores 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 Ross Stores are associated (or correlated) with PICKN PAY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PICKN PAY STORES has no effect on the direction of Ross Stores i.e., Ross Stores and PICKN PAY go up and down completely randomly.

Pair Corralation between Ross Stores and PICKN PAY

Assuming the 90 days trading horizon Ross Stores is expected to under-perform the PICKN PAY. In addition to that, Ross Stores is 1.04 times more volatile than PICKN PAY STORES. It trades about -0.02 of its total potential returns per unit of risk. PICKN PAY STORES is currently generating about -0.01 per unit of volatility. If you would invest  126.00  in PICKN PAY STORES on April 23, 2025 and sell it today you would lose (4.00) from holding PICKN PAY STORES or give up 3.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Ross Stores  vs.  PICKN PAY STORES

Ross Stores

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ross Stores has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Ross Stores is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

PICKN PAY STORES

Risk-Adjusted Performance

Very Weak

Over the last 90 days PICKN PAY STORES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, PICKN PAY is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Ross Stores and PICKN PAY

The main advantage of trading using opposite Ross Stores and PICKN PAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ross Stores position performs unexpectedly, PICKN PAY 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 PICKN PAY will offset losses from the drop in PICKN PAY's long position.

The idea behind Ross Stores and PICKN PAY STORES pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.