Correlation Between Focus Home and Koninklijke Ahold
Can any of the company-specific risk be diversified away by investing in both Focus Home and Koninklijke Ahold 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 Focus Home and Koninklijke Ahold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Focus Home Interactive and Koninklijke Ahold Delhaize, you can compare the effects of market volatilities on Focus Home and Koninklijke Ahold 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 Focus Home with a short position of Koninklijke Ahold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Focus Home and Koninklijke Ahold.
Diversification Opportunities for Focus Home and Koninklijke Ahold
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Focus and Koninklijke is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Focus Home Interactive and Koninklijke Ahold Delhaize in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koninklijke Ahold and Focus Home 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 Focus Home Interactive are associated (or correlated) with Koninklijke Ahold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koninklijke Ahold has no effect on the direction of Focus Home i.e., Focus Home and Koninklijke Ahold go up and down completely randomly.
Pair Corralation between Focus Home and Koninklijke Ahold
If you would invest 1,938 in Focus Home Interactive on October 28, 2024 and sell it today you would earn a total of 162.00 from holding Focus Home Interactive or generate 8.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Focus Home Interactive vs. Koninklijke Ahold Delhaize
Performance |
| Timeline |
| Focus Home Interactive |
| Koninklijke Ahold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Focus Home and Koninklijke Ahold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Focus Home and Koninklijke Ahold
The main advantage of trading using opposite Focus Home and Koninklijke Ahold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Focus Home position performs unexpectedly, Koninklijke Ahold 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 Koninklijke Ahold will offset losses from the drop in Koninklijke Ahold's long position.| Focus Home vs. Summit Materials | Focus Home vs. National Health Investors | Focus Home vs. Phibro Animal Health | Focus Home vs. Acadia Healthcare |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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