Correlation Between Sligro Food and Abingdon Health
Can any of the company-specific risk be diversified away by investing in both Sligro Food and Abingdon Health 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 Abingdon Health 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 Abingdon Health Plc, you can compare the effects of market volatilities on Sligro Food and Abingdon Health 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 Abingdon Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sligro Food and Abingdon Health.
Diversification Opportunities for Sligro Food and Abingdon Health
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sligro and Abingdon is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Sligro Food Group and Abingdon Health Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abingdon Health Plc 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 Abingdon Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abingdon Health Plc has no effect on the direction of Sligro Food i.e., Sligro Food and Abingdon Health go up and down completely randomly.
Pair Corralation between Sligro Food and Abingdon Health
Assuming the 90 days trading horizon Sligro Food Group is expected to generate 0.36 times more return on investment than Abingdon Health. However, Sligro Food Group is 2.79 times less risky than Abingdon Health. It trades about -0.25 of its potential returns per unit of risk. Abingdon Health Plc is currently generating about -0.09 per unit of risk. If you would invest 1,224 in Sligro Food Group on September 13, 2024 and sell it today you would lose (150.00) from holding Sligro Food Group or give up 12.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sligro Food Group vs. Abingdon Health Plc
Performance |
| Timeline |
| Sligro Food Group |
| Abingdon Health Plc |
Sligro Food and Abingdon Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sligro Food and Abingdon Health
The main advantage of trading using opposite Sligro Food and Abingdon Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sligro Food position performs unexpectedly, Abingdon Health 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 Abingdon Health will offset losses from the drop in Abingdon Health's long position.| Sligro Food vs. Samsung Electronics Co | Sligro Food vs. Samsung Electronics Co | Sligro Food vs. Hyundai Motor | Sligro Food vs. Reliance Industries Ltd |
| Abingdon Health vs. SBM Offshore NV | Abingdon Health vs. Hochschild Mining plc | Abingdon Health vs. Indutrade AB | Abingdon Health vs. GreenX Metals |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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