Correlation Between Axfood AB and Triad Group
Can any of the company-specific risk be diversified away by investing in both Axfood AB and Triad Group 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 Axfood AB and Triad Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axfood AB and Triad Group PLC, you can compare the effects of market volatilities on Axfood AB and Triad Group 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 Axfood AB with a short position of Triad Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axfood AB and Triad Group.
Diversification Opportunities for Axfood AB and Triad Group
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Axfood and Triad is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Axfood AB and Triad Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triad Group PLC and Axfood AB 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 Axfood AB are associated (or correlated) with Triad Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triad Group PLC has no effect on the direction of Axfood AB i.e., Axfood AB and Triad Group go up and down completely randomly.
Pair Corralation between Axfood AB and Triad Group
Assuming the 90 days trading horizon Axfood AB is expected to under-perform the Triad Group. But the stock apears to be less risky and, when comparing its historical volatility, Axfood AB is 1.75 times less risky than Triad Group. The stock trades about -0.01 of its potential returns per unit of risk. The Triad Group PLC is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 8,520 in Triad Group PLC on September 3, 2024 and sell it today you would earn a total of 20,480 from holding Triad Group PLC or generate 240.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Axfood AB vs. Triad Group PLC
Performance |
| Timeline |
| Axfood AB |
| Triad Group PLC |
Axfood AB and Triad Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axfood AB and Triad Group
The main advantage of trading using opposite Axfood AB and Triad Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axfood AB position performs unexpectedly, Triad Group 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 Triad Group will offset losses from the drop in Triad Group's long position.| Axfood AB vs. Catalyst Media Group | Axfood AB vs. CATLIN GROUP | Axfood AB vs. Magnora ASA | Axfood AB vs. RTW Venture Fund |
| Triad Group vs. Global Net Lease | Triad Group vs. Discover Financial Services | Triad Group vs. MyHealthChecked Plc | Triad Group vs. Inspiration Healthcare Group |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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