Correlation Between Koninklijke Ahold and Intel
Can any of the company-specific risk be diversified away by investing in both Koninklijke Ahold and Intel 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 Koninklijke Ahold and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koninklijke Ahold Delhaize and Intel, you can compare the effects of market volatilities on Koninklijke Ahold and Intel 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 Koninklijke Ahold with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koninklijke Ahold and Intel.
Diversification Opportunities for Koninklijke Ahold and Intel
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Koninklijke and Intel is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Koninklijke Ahold Delhaize and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and Koninklijke Ahold 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 Koninklijke Ahold Delhaize are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Koninklijke Ahold i.e., Koninklijke Ahold and Intel go up and down completely randomly.
Pair Corralation between Koninklijke Ahold and Intel
Assuming the 90 days trading horizon Koninklijke Ahold Delhaize is expected to generate 0.28 times more return on investment than Intel. However, Koninklijke Ahold Delhaize is 3.59 times less risky than Intel. It trades about 0.11 of its potential returns per unit of risk. Intel is currently generating about -0.02 per unit of risk. If you would invest 2,831 in Koninklijke Ahold Delhaize on September 1, 2024 and sell it today you would earn a total of 424.00 from holding Koninklijke Ahold Delhaize or generate 14.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.24% |
| Values | Daily Returns |
Koninklijke Ahold Delhaize vs. Intel
Performance |
| Timeline |
| Koninklijke Ahold |
| Intel |
Koninklijke Ahold and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koninklijke Ahold and Intel
The main advantage of trading using opposite Koninklijke Ahold and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koninklijke Ahold position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| Koninklijke Ahold vs. TESCO PLC LS 0633333 | Koninklijke Ahold vs. Superior Plus Corp | Koninklijke Ahold vs. NMI Holdings | Koninklijke Ahold vs. Origin Agritech |
| Intel vs. PARKEN Sport Entertainment | Intel vs. ARDAGH METAL PACDL 0001 | Intel vs. Columbia Sportswear | Intel vs. POWER METALS |
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.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |