Correlation Between Sligro Food and Rockwood Realisation
Can any of the company-specific risk be diversified away by investing in both Sligro Food and Rockwood Realisation 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 Rockwood Realisation 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 Rockwood Realisation PLC, you can compare the effects of market volatilities on Sligro Food and Rockwood Realisation 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 Rockwood Realisation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sligro Food and Rockwood Realisation.
Diversification Opportunities for Sligro Food and Rockwood Realisation
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sligro and Rockwood is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Sligro Food Group and Rockwood Realisation PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rockwood Realisation 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 Rockwood Realisation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rockwood Realisation PLC has no effect on the direction of Sligro Food i.e., Sligro Food and Rockwood Realisation go up and down completely randomly.
Pair Corralation between Sligro Food and Rockwood Realisation
Assuming the 90 days trading horizon Sligro Food Group is expected to under-perform the Rockwood Realisation. In addition to that, Sligro Food is 1.44 times more volatile than Rockwood Realisation PLC. It trades about -0.06 of its total potential returns per unit of risk. Rockwood Realisation PLC is currently generating about 0.12 per unit of volatility. If you would invest 20,400 in Rockwood Realisation PLC on September 1, 2024 and sell it today you would earn a total of 4,950 from holding Rockwood Realisation PLC or generate 24.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sligro Food Group vs. Rockwood Realisation PLC
Performance |
| Timeline |
| Sligro Food Group |
| Rockwood Realisation PLC |
Sligro Food and Rockwood Realisation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sligro Food and Rockwood Realisation
The main advantage of trading using opposite Sligro Food and Rockwood Realisation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sligro Food position performs unexpectedly, Rockwood Realisation 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 Rockwood Realisation will offset losses from the drop in Rockwood Realisation's long position.| Sligro Food vs. DFS Furniture PLC | Sligro Food vs. Jupiter Fund Management | Sligro Food vs. Gamma Communications PLC | Sligro Food vs. Impax Asset Management |
| Rockwood Realisation vs. Austevoll Seafood ASA | Rockwood Realisation vs. Sligro Food Group | Rockwood Realisation vs. Axfood AB | Rockwood Realisation vs. Zegona Communications Plc |
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 CEOs Directory module to screen CEOs from public companies around the world.
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