Correlation Between Rite Aid and Weis Markets
Can any of the company-specific risk be diversified away by investing in both Rite Aid and Weis Markets 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 Rite Aid and Weis Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rite Aid and Weis Markets, you can compare the effects of market volatilities on Rite Aid and Weis Markets 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 Rite Aid with a short position of Weis Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rite Aid and Weis Markets.
Diversification Opportunities for Rite Aid and Weis Markets
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Rite and Weis is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Rite Aid and Weis Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weis Markets and Rite Aid 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 Rite Aid are associated (or correlated) with Weis Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weis Markets has no effect on the direction of Rite Aid i.e., Rite Aid and Weis Markets go up and down completely randomly.
Pair Corralation between Rite Aid and Weis Markets
Considering the 90-day investment horizon Rite Aid is expected to under-perform the Weis Markets. In addition to that, Rite Aid is 6.44 times more volatile than Weis Markets. It trades about -0.07 of its total potential returns per unit of risk. Weis Markets is currently generating about -0.05 per unit of volatility. If you would invest 8,208 in Weis Markets on January 20, 2024 and sell it today you would lose (1,942) from holding Weis Markets or give up 23.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 66.27% |
| Values | Daily Returns |
Rite Aid vs. Weis Markets
Performance |
| Timeline |
| Rite Aid |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Weis Markets |
Rite Aid and Weis Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rite Aid and Weis Markets
The main advantage of trading using opposite Rite Aid and Weis Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rite Aid position performs unexpectedly, Weis Markets 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 Weis Markets will offset losses from the drop in Weis Markets' long position.| Rite Aid vs. PetMed Express | Rite Aid vs. High Tide | Rite Aid vs. China Jo Jo Drugstores | Rite Aid vs. Bimi International Medical |
| Weis Markets vs. Aquagold International | Weis Markets vs. Morningstar Unconstrained Allocation | Weis Markets vs. Thrivent High Yield | Weis Markets vs. Via Renewables |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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