Correlation Between PFSweb and Unifirst

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

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

Diversification Opportunities for PFSweb and Unifirst

0.35

Correlation Coefficient

PFSweb  Unifirst

Weak diversification

The 3 months correlation between PFSweb and Unifirst is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding PFSweb Inc and Unifirst in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unifirst and PFSweb 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 PFSweb Inc are associated (or correlated) with Unifirst. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unifirst has no effect on the direction of PFSweb i.e., PFSweb and Unifirst go up and down completely randomly.

Pair Corralation between PFSweb and Unifirst

If you would invest  17,988  in Unifirst on September 2, 2024 and sell it today you would earn a total of  2,099  from holding Unifirst or generate 11.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

PFSweb Inc  vs.  Unifirst

PFSweb Inc

Risk-Adjusted Performance

0 of 100

Very Weak

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

Unifirst

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Unifirst are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Unifirst may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with PFSweb and Unifirst

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

The idea behind PFSweb Inc and Unifirst 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.