Correlation Between Home Depot and Grieg Seafood
Can any of the company-specific risk be diversified away by investing in both Home Depot and Grieg Seafood 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 Home Depot and Grieg Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Depot and Grieg Seafood, you can compare the effects of market volatilities on Home Depot and Grieg Seafood 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 Home Depot with a short position of Grieg Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and Grieg Seafood.
Diversification Opportunities for Home Depot and Grieg Seafood
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Home and Grieg is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Home Depot and Grieg Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grieg Seafood and Home Depot 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 Home Depot are associated (or correlated) with Grieg Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grieg Seafood has no effect on the direction of Home Depot i.e., Home Depot and Grieg Seafood go up and down completely randomly.
Pair Corralation between Home Depot and Grieg Seafood
If you would invest 6,255 in Grieg Seafood on November 3, 2024 and sell it today you would earn a total of 1,190 from holding Grieg Seafood or generate 19.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Home Depot vs. Grieg Seafood
Performance |
| Timeline |
| Home Depot |
| Grieg Seafood |
Home Depot and Grieg Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Depot and Grieg Seafood
The main advantage of trading using opposite Home Depot and Grieg Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Depot position performs unexpectedly, Grieg Seafood 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 Grieg Seafood will offset losses from the drop in Grieg Seafood's long position.| Home Depot vs. Amedeo Air Four | Home Depot vs. Norwegian Air Shuttle | Home Depot vs. Wizz Air Holdings | Home Depot vs. Ryanair Holdings plc |
| Grieg Seafood vs. Alfa Financial Software | Grieg Seafood vs. Fevertree Drinks Plc | Grieg Seafood vs. Bisichi Mining PLC | Grieg Seafood vs. Coeur Mining |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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