Correlation Between Hollywood Bowl and Supermarket Income
Can any of the company-specific risk be diversified away by investing in both Hollywood Bowl and Supermarket Income 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 Hollywood Bowl and Supermarket Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hollywood Bowl Group and Supermarket Income REIT, you can compare the effects of market volatilities on Hollywood Bowl and Supermarket Income 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 Hollywood Bowl with a short position of Supermarket Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hollywood Bowl and Supermarket Income.
Diversification Opportunities for Hollywood Bowl and Supermarket Income
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hollywood and Supermarket is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hollywood Bowl Group and Supermarket Income REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Supermarket Income REIT and Hollywood Bowl 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 Hollywood Bowl Group are associated (or correlated) with Supermarket Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Supermarket Income REIT has no effect on the direction of Hollywood Bowl i.e., Hollywood Bowl and Supermarket Income go up and down completely randomly.
Pair Corralation between Hollywood Bowl and Supermarket Income
Assuming the 90 days trading horizon Hollywood Bowl Group is expected to generate 1.2 times more return on investment than Supermarket Income. However, Hollywood Bowl is 1.2 times more volatile than Supermarket Income REIT. It trades about -0.01 of its potential returns per unit of risk. Supermarket Income REIT is currently generating about -0.01 per unit of risk. If you would invest 32,733 in Hollywood Bowl Group on September 1, 2024 and sell it today you would lose (733.00) from holding Hollywood Bowl Group or give up 2.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hollywood Bowl Group vs. Supermarket Income REIT
Performance |
| Timeline |
| Hollywood Bowl Group |
| Supermarket Income REIT |
Hollywood Bowl and Supermarket Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hollywood Bowl and Supermarket Income
The main advantage of trading using opposite Hollywood Bowl and Supermarket Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hollywood Bowl position performs unexpectedly, Supermarket Income 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 Supermarket Income will offset losses from the drop in Supermarket Income's long position.| Hollywood Bowl vs. Public Storage | Hollywood Bowl vs. Optima Health plc | Hollywood Bowl vs. Bellevue Healthcare Trust | Hollywood Bowl vs. Target Healthcare REIT |
| Supermarket Income vs. Infrastrutture Wireless Italiane | Supermarket Income vs. Southwest Airlines Co | Supermarket Income vs. Indutrade AB | Supermarket Income vs. Greenroc Mining PLC |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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