Correlation Between G III and PICKN PAY

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

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

Diversification Opportunities for G III and PICKN PAY

0.42

Correlation Coefficient

G III  PICKN PAY

Very weak diversification

The 3 months correlation between GI4 and PICKN is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding G III Apparel Group 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 G III 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 G III Apparel Group 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 G III i.e., G III and PICKN PAY go up and down completely randomly.

Pair Corralation between G III and PICKN PAY

Assuming the 90 days trading horizon G III Apparel Group is expected to under-perform the PICKN PAY. In addition to that, G III is 1.2 times more volatile than PICKN PAY STORES. It trades about -0.1 of its total potential returns per unit of risk. PICKN PAY STORES is currently generating about -0.1 per unit of volatility. If you would invest  156.00  in PICKN PAY STORES on December 4, 2024 and sell it today you would lose (19.00) from holding PICKN PAY STORES or give up 12.18% of portfolio value over 90 days.

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

G III Apparel Group  vs.  PICKN PAY STORES

G III Apparel

Risk-Adjusted Performance

Very Weak

Over the last 90 days G III Apparel Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm 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 latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with G III and PICKN PAY

The main advantage of trading using opposite G III and PICKN PAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G III 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 G III Apparel Group 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.