Correlation Between Sligro Food and Coor Service
Can any of the company-specific risk be diversified away by investing in both Sligro Food and Coor Service 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 Sligro Food and Coor Service into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sligro Food Group and Coor Service Management, you can compare the effects of market volatilities on Sligro Food and Coor Service 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 Sligro Food with a short position of Coor Service. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sligro Food and Coor Service.
Diversification Opportunities for Sligro Food and Coor Service
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sligro and Coor is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Sligro Food Group and Coor Service Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coor Service Management and Sligro Food 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 Sligro Food Group are associated (or correlated) with Coor Service. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coor Service Management has no effect on the direction of Sligro Food i.e., Sligro Food and Coor Service go up and down completely randomly.
Pair Corralation between Sligro Food and Coor Service
Assuming the 90 days trading horizon Sligro Food is expected to generate 4.78 times less return on investment than Coor Service. But when comparing it to its historical volatility, Sligro Food Group is 1.02 times less risky than Coor Service. It trades about 0.05 of its potential returns per unit of risk. Coor Service Management is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 3,495 in Coor Service Management on October 11, 2024 and sell it today you would earn a total of 185.00 from holding Coor Service Management or generate 5.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.0% |
| Values | Daily Returns |
Sligro Food Group vs. Coor Service Management
Performance |
| Timeline |
| Sligro Food Group |
| Coor Service Management |
Sligro Food and Coor Service Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sligro Food and Coor Service
The main advantage of trading using opposite Sligro Food and Coor Service positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sligro Food position performs unexpectedly, Coor Service 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 Coor Service will offset losses from the drop in Coor Service's long position.| Sligro Food vs. Nordic Semiconductor ASA | Sligro Food vs. Gamma Communications PLC | Sligro Food vs. British American Tobacco | Sligro Food vs. Alliance Data Systems |
| Coor Service vs. Mobius Investment Trust | Coor Service vs. International Biotechnology Trust | Coor Service vs. Qurate Retail Series | Coor Service vs. Ecclesiastical Insurance Office |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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