Correlation Between Vipshop Holdings and Arko Corp

Can any of the company-specific risk be diversified away by investing in both Vipshop Holdings and Arko 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 Vipshop Holdings and Arko Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vipshop Holdings Limited and Arko Corp, you can compare the effects of market volatilities on Vipshop Holdings and Arko 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 Vipshop Holdings with a short position of Arko Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vipshop Holdings and Arko Corp.

Diversification Opportunities for Vipshop Holdings and Arko Corp

-0.38

Correlation Coefficient

Vipshop Holdings  Arko Corp

Very good diversification

The 3 months correlation between Vipshop and Arko is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Vipshop Holdings Limited and Arko Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arko Corp and Vipshop Holdings 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 Vipshop Holdings Limited are associated (or correlated) with Arko Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arko Corp has no effect on the direction of Vipshop Holdings i.e., Vipshop Holdings and Arko Corp go up and down completely randomly.

Pair Corralation between Vipshop Holdings and Arko Corp

Given the investment horizon of 90 days Vipshop Holdings is expected to generate 2.04 times less return on investment than Arko Corp. But when comparing it to its historical volatility, Vipshop Holdings Limited is 6.72 times less risky than Arko Corp. It trades about 0.09 of its potential returns per unit of risk. Arko Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1.27  in Arko Corp on August 26, 2025 and sell it today you would lose (0.34) from holding Arko Corp or give up 26.77% of portfolio value over 90 days.

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

Vipshop Holdings Limited  vs.  Arko Corp

Vipshop Holdings

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Vipshop Holdings Limited are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Vipshop Holdings may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Arko Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Arko Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Arko Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vipshop Holdings and Arko Corp

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

The idea behind Vipshop Holdings Limited and Arko Corp 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.

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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.