Correlation Between Ross Stores and Standard Chartered
Can any of the company-specific risk be diversified away by investing in both Ross Stores and Standard Chartered 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 Standard Chartered into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ross Stores and Standard Chartered PLC, you can compare the effects of market volatilities on Ross Stores and Standard Chartered 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 Standard Chartered. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and Standard Chartered.
Diversification Opportunities for Ross Stores and Standard Chartered
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ross and Standard is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and Standard Chartered PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Standard Chartered PLC 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 Standard Chartered. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Standard Chartered PLC has no effect on the direction of Ross Stores i.e., Ross Stores and Standard Chartered go up and down completely randomly.
Pair Corralation between Ross Stores and Standard Chartered
Assuming the 90 days trading horizon Ross Stores is expected to generate 1.77 times less return on investment than Standard Chartered. But when comparing it to its historical volatility, Ross Stores is 1.38 times less risky than Standard Chartered. It trades about 0.05 of its potential returns per unit of risk. Standard Chartered PLC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 58,619 in Standard Chartered PLC on September 14, 2024 and sell it today you would earn a total of 40,541 from holding Standard Chartered PLC or generate 69.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.79% |
| Values | Daily Returns |
Ross Stores vs. Standard Chartered PLC
Performance |
| Timeline |
| Ross Stores |
| Standard Chartered PLC |
Ross Stores and Standard Chartered Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ross Stores and Standard Chartered
The main advantage of trading using opposite Ross Stores and Standard Chartered positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ross Stores position performs unexpectedly, Standard Chartered 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 Standard Chartered will offset losses from the drop in Standard Chartered's long position.| Ross Stores vs. Aurora Investment Trust | Ross Stores vs. GreenX Metals | Ross Stores vs. Cornish Metals | Ross Stores vs. Panther Metals PLC |
| Standard Chartered vs. PureTech Health plc | Standard Chartered vs. Taiwan Semiconductor Manufacturing | Standard Chartered vs. Planet Fitness Cl | Standard Chartered vs. Ross Stores |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |