Correlation Between Carrefour and Koninklijke Ahold
Can any of the company-specific risk be diversified away by investing in both Carrefour and Koninklijke Ahold 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 Carrefour and Koninklijke Ahold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carrefour SA and Koninklijke Ahold Delhaize, you can compare the effects of market volatilities on Carrefour and Koninklijke Ahold 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 Carrefour with a short position of Koninklijke Ahold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carrefour and Koninklijke Ahold.
Diversification Opportunities for Carrefour and Koninklijke Ahold
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Carrefour and Koninklijke is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Carrefour SA and Koninklijke Ahold Delhaize in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koninklijke Ahold and Carrefour 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 Carrefour SA are associated (or correlated) with Koninklijke Ahold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koninklijke Ahold has no effect on the direction of Carrefour i.e., Carrefour and Koninklijke Ahold go up and down completely randomly.
Pair Corralation between Carrefour and Koninklijke Ahold
Assuming the 90 days horizon Carrefour SA is expected to under-perform the Koninklijke Ahold. In addition to that, Carrefour is 1.33 times more volatile than Koninklijke Ahold Delhaize. It trades about -0.04 of its total potential returns per unit of risk. Koninklijke Ahold Delhaize is currently generating about 0.05 per unit of volatility. If you would invest 2,855 in Koninklijke Ahold Delhaize on September 5, 2024 and sell it today you would earn a total of 480.00 from holding Koninklijke Ahold Delhaize or generate 16.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 88.57% |
| Values | Daily Returns |
Carrefour SA vs. Koninklijke Ahold Delhaize
Performance |
| Timeline |
| Carrefour SA |
| Koninklijke Ahold |
Carrefour and Koninklijke Ahold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carrefour and Koninklijke Ahold
The main advantage of trading using opposite Carrefour and Koninklijke Ahold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carrefour position performs unexpectedly, Koninklijke Ahold 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 Koninklijke Ahold will offset losses from the drop in Koninklijke Ahold's long position.| Carrefour vs. J Sainsbury plc | Carrefour vs. Om Holdings International | Carrefour vs. Carrefour SA PK | Carrefour vs. Kesko Oyj ADR |
| Koninklijke Ahold vs. Weis Markets | Koninklijke Ahold vs. Albertsons Companies | Koninklijke Ahold vs. Dingdong ADR | Koninklijke Ahold vs. Natural Grocers by |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |