Correlation Between Blue Apron and Chewy

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Blue Apron 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 Blue Apron and Chewy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Apron Holdings and Chewy Inc, you can compare the effects of market volatilities on Blue Apron 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 Blue Apron with a short position of Chewy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Apron and Chewy.

Diversification Opportunities for Blue Apron and Chewy

0.78
  Correlation Coefficient

Poor diversification

The 3 months correlation between Blue Apron and Chewy is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Blue Apron Holdings and Chewy Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chewy Inc and Blue Apron 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 Blue Apron Holdings 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 Blue Apron i.e., Blue Apron and Chewy go up and down completely randomly.

Pair Corralation between Blue Apron and Chewy

Given the investment horizon of 90 days Blue Apron Holdings is expected to generate 1.43 times more return on investment than Chewy. However, Blue Apron is 1.43 times more volatile than Chewy Inc. It trades about -0.03 of its potential returns per unit of risk. Chewy Inc is currently generating about -0.12 per unit of risk. If you would invest  358.00  in Blue Apron Holdings on February 26, 2022 and sell it today you would lose (48.00)  from holding Blue Apron Holdings or give up 13.41% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy95.65%
ValuesDaily Returns

Blue Apron Holdings  vs.  Chewy Inc

 Performance (%) 
      Timeline 
Blue Apron Holdings 
Blue Apron Performance
0 of 100
Over the last 90 days Blue Apron Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in June 2022. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Blue Apron Price Channel

Chewy Inc 
Chewy Performance
0 of 100
Over the last 90 days Chewy Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in June 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Chewy Price Channel

Blue Apron and Chewy Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Blue Apron and Chewy

The main advantage of trading using opposite Blue Apron and Chewy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Apron 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 Blue Apron Holdings 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .

Other Complementary Tools

Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope
Go
ETF Directory
Find actively traded Exchange Traded Funds (ETF) from around the world
Go
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Go
Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Shere Portfolio
Track or share privately all of your investments from the convenience of any device
Go
Pattern Recognition
Use different Pattern Recognition models to time the market across multiple global exchanges
Go
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Go