Correlation Between Acrow and Super Retail
Can any of the company-specific risk be diversified away by investing in both Acrow and Super Retail 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 Acrow and Super Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acrow Limited and Super Retail Group, you can compare the effects of market volatilities on Acrow and Super Retail 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 Acrow with a short position of Super Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acrow and Super Retail.
Diversification Opportunities for Acrow and Super Retail
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Acrow and Super is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Acrow Limited and Super Retail Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Super Retail Group and Acrow 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 Acrow Limited are associated (or correlated) with Super Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Super Retail Group has no effect on the direction of Acrow i.e., Acrow and Super Retail go up and down completely randomly.
Pair Corralation between Acrow and Super Retail
Assuming the 90 days trading horizon Acrow Limited is expected to generate 1.11 times more return on investment than Super Retail. However, Acrow is 1.11 times more volatile than Super Retail Group. It trades about 0.09 of its potential returns per unit of risk. Super Retail Group is currently generating about -0.15 per unit of risk. If you would invest 96.00 in Acrow Limited on September 12, 2024 and sell it today you would earn a total of 9.00 from holding Acrow Limited or generate 9.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Acrow Limited vs. Super Retail Group
Performance |
| Timeline |
| Acrow Limited |
| Super Retail Group |
Acrow and Super Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acrow and Super Retail
The main advantage of trading using opposite Acrow and Super Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acrow position performs unexpectedly, Super Retail 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 Super Retail will offset losses from the drop in Super Retail's long position.The idea behind Acrow Limited and Super Retail Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Super Retail vs. Microequities Asset Management | Super Retail vs. Stelar Metals | Super Retail vs. Falcon Metals | Super Retail vs. Auctus Alternative Investments |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |