Correlation Between Ross Stores and Alight
Can any of the company-specific risk be diversified away by investing in both Ross Stores and Alight 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 Ross Stores and Alight into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ross Stores and Alight Inc, you can compare the effects of market volatilities on Ross Stores and Alight 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 Ross Stores with a short position of Alight. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and Alight.
Diversification Opportunities for Ross Stores and Alight
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ross and Alight is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and Alight Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alight Inc and Ross Stores 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 Ross Stores are associated (or correlated) with Alight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alight Inc has no effect on the direction of Ross Stores i.e., Ross Stores and Alight go up and down completely randomly.
Pair Corralation between Ross Stores and Alight
Given the investment horizon of 90 days Ross Stores is expected to generate 0.53 times more return on investment than Alight. However, Ross Stores is 1.87 times less risky than Alight. It trades about 0.17 of its potential returns per unit of risk. Alight Inc is currently generating about -0.27 per unit of risk. If you would invest 15,085 in Ross Stores on August 31, 2025 and sell it today you would earn a total of 2,551 from holding Ross Stores or generate 16.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ross Stores vs. Alight Inc
Performance |
| Timeline |
| Ross Stores |
| Alight Inc |
Ross Stores and Alight Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ross Stores and Alight
The main advantage of trading using opposite Ross Stores and Alight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ross Stores position performs unexpectedly, Alight 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 Alight will offset losses from the drop in Alight's long position.| Ross Stores vs. Golden Energy Offshore | Ross Stores vs. InterContinental Hotels Group | Ross Stores vs. Chatham Lodging Trust | Ross Stores vs. Hoteles City Express |
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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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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