Correlation Between Kelly Services and Ziprecruiter

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

By analyzing existing cross correlation between Kelly Services B and Ziprecruiter, you can compare the effects of market volatilities on Kelly Services and Ziprecruiter 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 Kelly Services with a short position of Ziprecruiter. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kelly Services and Ziprecruiter.

Diversification Opportunities for Kelly Services and Ziprecruiter

0.29

Correlation Coefficient

Kelly Services  Ziprecruiter

Modest diversification

The 3 months correlation between Kelly and Ziprecruiter is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Kelly Services B and Ziprecruiter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ziprecruiter and Kelly Services 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 Kelly Services B are associated (or correlated) with Ziprecruiter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ziprecruiter has no effect on the direction of Kelly Services i.e., Kelly Services and Ziprecruiter go up and down completely randomly.

Pair Corralation between Kelly Services and Ziprecruiter

Assuming the 90 days horizon Kelly Services B is expected to generate 0.76 times more return on investment than Ziprecruiter. However, Kelly Services B is 1.31 times less risky than Ziprecruiter. It trades about 0.0 of its potential returns per unit of risk. Ziprecruiter is currently generating about -0.08 per unit of risk. If you would invest  1,386  in Kelly Services B on December 30, 2024 and sell it today you would lose (32.00) from holding Kelly Services B or give up 2.31% of portfolio value over 90 days.

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

Kelly Services B  vs.  Ziprecruiter

Kelly Services B

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kelly Services B has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Kelly Services is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Ziprecruiter

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ziprecruiter has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's forward indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Kelly Services and Ziprecruiter

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

The idea behind Kelly Services B and Ziprecruiter 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .