Correlation Between Superior Plus and STORE ELECTRONIC
Can any of the company-specific risk be diversified away by investing in both Superior Plus and STORE ELECTRONIC 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 STORE ELECTRONIC 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 STORE ELECTRONIC, you can compare the effects of market volatilities on Superior Plus and STORE ELECTRONIC 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 STORE ELECTRONIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and STORE ELECTRONIC.
Diversification Opportunities for Superior Plus and STORE ELECTRONIC
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Superior and STORE is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and STORE ELECTRONIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STORE ELECTRONIC 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 STORE ELECTRONIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STORE ELECTRONIC has no effect on the direction of Superior Plus i.e., Superior Plus and STORE ELECTRONIC go up and down completely randomly.
Pair Corralation between Superior Plus and STORE ELECTRONIC
Assuming the 90 days horizon Superior Plus Corp is expected to under-perform the STORE ELECTRONIC. But the stock apears to be less risky and, when comparing its historical volatility, Superior Plus Corp is 1.29 times less risky than STORE ELECTRONIC. The stock trades about -0.16 of its potential returns per unit of risk. The STORE ELECTRONIC is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 16,490 in STORE ELECTRONIC on November 27, 2024 and sell it today you would lose (300.00) from holding STORE ELECTRONIC or give up 1.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. STORE ELECTRONIC
Performance |
| Timeline |
| Superior Plus Corp |
| STORE ELECTRONIC |
Superior Plus and STORE ELECTRONIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and STORE ELECTRONIC
The main advantage of trading using opposite Superior Plus and STORE ELECTRONIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, STORE ELECTRONIC 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 STORE ELECTRONIC will offset losses from the drop in STORE ELECTRONIC's long position.| Superior Plus vs. SANOK RUBBER ZY | Superior Plus vs. APPLIED MATERIALS | Superior Plus vs. WILLIS LEASE FIN | Superior Plus vs. FUYO GENERAL LEASE |
| STORE ELECTRONIC vs. PARKEN SPORT ENT | STORE ELECTRONIC vs. TOREX SEMICONDUCTOR LTD | STORE ELECTRONIC vs. Magnachip Semiconductor | STORE ELECTRONIC vs. Yuexiu Transport Infrastructure |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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