Correlation Between MOGU and Chewy

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

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

Diversification Opportunities for MOGU and Chewy

0.66

Correlation Coefficient

MOGU  Chewy

Poor diversification

The 3 months correlation between MOGU and Chewy is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding MOGU Inc and Chewy Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chewy Inc and MOGU 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 MOGU Inc are associated (or correlated) with Chewy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chewy Inc has no effect on the direction of MOGU i.e., MOGU and Chewy go up and down completely randomly.

Pair Corralation between MOGU and Chewy

Given the investment horizon of 90 days MOGU Inc is expected to generate 1.41 times more return on investment than Chewy. However, MOGU is 1.41 times more volatile than Chewy Inc. It trades about 0.05 of its potential returns per unit of risk. Chewy Inc is currently generating about 0.0 per unit of risk. If you would invest  210.00  in MOGU Inc on December 27, 2024 and sell it today you would earn a total of  17.00  from holding MOGU Inc or generate 8.1% return on investment over 90 days.

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

MOGU Inc  vs.  Chewy Inc

MOGU Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MOGU Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal technical and fundamental indicators, MOGU may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Chewy Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chewy Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Chewy is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with MOGU and Chewy

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

The idea behind MOGU Inc and Chewy Inc 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.