Correlation Between WIMFARM SA and United Natural
Can any of the company-specific risk be diversified away by investing in both WIMFARM SA and United Natural 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 WIMFARM SA and United Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WIMFARM SA EO and United Natural Foods, you can compare the effects of market volatilities on WIMFARM SA and United Natural 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 WIMFARM SA with a short position of United Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and United Natural.
Diversification Opportunities for WIMFARM SA and United Natural
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WIMFARM and United is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and United Natural Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Natural Foods and WIMFARM SA 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 WIMFARM SA EO are associated (or correlated) with United Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Natural Foods has no effect on the direction of WIMFARM SA i.e., WIMFARM SA and United Natural go up and down completely randomly.
Pair Corralation between WIMFARM SA and United Natural
Assuming the 90 days horizon WIMFARM SA EO is expected to under-perform the United Natural. But the stock apears to be less risky and, when comparing its historical volatility, WIMFARM SA EO is 1.76 times less risky than United Natural. The stock trades about -0.21 of its potential returns per unit of risk. The United Natural Foods is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 1,888 in United Natural Foods on September 1, 2024 and sell it today you would earn a total of 402.00 from holding United Natural Foods or generate 21.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIMFARM SA EO vs. United Natural Foods
Performance |
| Timeline |
| WIMFARM SA EO |
| United Natural Foods |
WIMFARM SA and United Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIMFARM SA and United Natural
The main advantage of trading using opposite WIMFARM SA and United Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIMFARM SA position performs unexpectedly, United Natural 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 United Natural will offset losses from the drop in United Natural's long position.| WIMFARM SA vs. UPDATE SOFTWARE | WIMFARM SA vs. XLMedia PLC | WIMFARM SA vs. GigaMedia | WIMFARM SA vs. FUYO GENERAL LEASE |
| United Natural vs. Sysco | United Natural vs. Jernimo Martins SGPS | United Natural vs. Bunzl plc | United Natural vs. Performance Food 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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