Correlation Between Chefs Warehouse and Sendas Distribuidora
Can any of the company-specific risk be diversified away by investing in both Chefs Warehouse and Sendas Distribuidora 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 Chefs Warehouse and Sendas Distribuidora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Chefs Warehouse and Sendas Distribuidora SA, you can compare the effects of market volatilities on Chefs Warehouse and Sendas Distribuidora 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 Chefs Warehouse with a short position of Sendas Distribuidora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chefs Warehouse and Sendas Distribuidora.
Diversification Opportunities for Chefs Warehouse and Sendas Distribuidora
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chefs and Sendas is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding The Chefs Warehouse and Sendas Distribuidora SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sendas Distribuidora and Chefs Warehouse 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 The Chefs Warehouse are associated (or correlated) with Sendas Distribuidora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sendas Distribuidora has no effect on the direction of Chefs Warehouse i.e., Chefs Warehouse and Sendas Distribuidora go up and down completely randomly.
Pair Corralation between Chefs Warehouse and Sendas Distribuidora
Given the investment horizon of 90 days The Chefs Warehouse is expected to generate 0.8 times more return on investment than Sendas Distribuidora. However, The Chefs Warehouse is 1.24 times less risky than Sendas Distribuidora. It trades about 0.04 of its potential returns per unit of risk. Sendas Distribuidora SA is currently generating about -0.05 per unit of risk. If you would invest 3,295 in The Chefs Warehouse on August 30, 2024 and sell it today you would earn a total of 1,161 from holding The Chefs Warehouse or generate 35.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
The Chefs Warehouse vs. Sendas Distribuidora SA
Performance |
| Timeline |
| Chefs Warehouse |
| Sendas Distribuidora |
Chefs Warehouse and Sendas Distribuidora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chefs Warehouse and Sendas Distribuidora
The main advantage of trading using opposite Chefs Warehouse and Sendas Distribuidora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chefs Warehouse position performs unexpectedly, Sendas Distribuidora 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 Sendas Distribuidora will offset losses from the drop in Sendas Distribuidora's long position.| Chefs Warehouse vs. US Foods Holding | Chefs Warehouse vs. Sysco | Chefs Warehouse vs. SpartanNash Co | Chefs Warehouse vs. Calavo Growers |
| Sendas Distribuidora vs. Village Super Market | Sendas Distribuidora vs. Weis Markets | Sendas Distribuidora vs. Ingles Markets Incorporated | Sendas Distribuidora vs. Grocery Outlet Holding |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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