Correlation Between Superior Plus and BJs Wholesale
Can any of the company-specific risk be diversified away by investing in both Superior Plus and BJs Wholesale 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 Superior Plus and BJs Wholesale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and BJs Wholesale Club, you can compare the effects of market volatilities on Superior Plus and BJs Wholesale 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 Superior Plus with a short position of BJs Wholesale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and BJs Wholesale.
Diversification Opportunities for Superior Plus and BJs Wholesale
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Superior and BJs is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and BJs Wholesale Club in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Wholesale Club and Superior Plus 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 Superior Plus Corp are associated (or correlated) with BJs Wholesale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BJs Wholesale Club has no effect on the direction of Superior Plus i.e., Superior Plus and BJs Wholesale go up and down completely randomly.
Pair Corralation between Superior Plus and BJs Wholesale
Assuming the 90 days horizon Superior Plus Corp is expected to under-perform the BJs Wholesale. In addition to that, Superior Plus is 2.43 times more volatile than BJs Wholesale Club. It trades about -0.04 of its total potential returns per unit of risk. BJs Wholesale Club is currently generating about 0.25 per unit of volatility. If you would invest 7,850 in BJs Wholesale Club on August 25, 2024 and sell it today you would earn a total of 950.00 from holding BJs Wholesale Club or generate 12.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. BJs Wholesale Club
Performance |
| Timeline |
| Superior Plus Corp |
| BJs Wholesale Club |
Superior Plus and BJs Wholesale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and BJs Wholesale
The main advantage of trading using opposite Superior Plus and BJs Wholesale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, BJs Wholesale 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 BJs Wholesale will offset losses from the drop in BJs Wholesale's long position.| Superior Plus vs. Fast Retailing Co | Superior Plus vs. Auto Trader Group | Superior Plus vs. Monster Beverage Corp | Superior Plus vs. Suntory Beverage Food |
| BJs Wholesale vs. Walmart | BJs Wholesale vs. Superior Plus Corp | BJs Wholesale vs. NMI Holdings | BJs Wholesale vs. Origin Agritech |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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