Correlation Between Calavo Growers and Sendas Distribuidora
Can any of the company-specific risk be diversified away by investing in both Calavo Growers 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 Calavo Growers and Sendas Distribuidora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calavo Growers and Sendas Distribuidora SA, you can compare the effects of market volatilities on Calavo Growers 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 Calavo Growers with a short position of Sendas Distribuidora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calavo Growers and Sendas Distribuidora.
Diversification Opportunities for Calavo Growers and Sendas Distribuidora
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Calavo and Sendas is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Calavo Growers and Sendas Distribuidora SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sendas Distribuidora and Calavo Growers 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 Calavo Growers 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 Calavo Growers i.e., Calavo Growers and Sendas Distribuidora go up and down completely randomly.
Pair Corralation between Calavo Growers and Sendas Distribuidora
Given the investment horizon of 90 days Calavo Growers is expected to generate 0.99 times more return on investment than Sendas Distribuidora. However, Calavo Growers is 1.01 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 -0.09 per unit of risk. If you would invest 2,251 in Calavo Growers on August 27, 2024 and sell it today you would earn a total of 466.00 from holding Calavo Growers or generate 20.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calavo Growers vs. Sendas Distribuidora SA
Performance |
| Timeline |
| Calavo Growers |
| Sendas Distribuidora |
Calavo Growers and Sendas Distribuidora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calavo Growers and Sendas Distribuidora
The main advantage of trading using opposite Calavo Growers and Sendas Distribuidora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calavo Growers 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.| Calavo Growers vs. SpartanNash Co | Calavo Growers vs. The Andersons | Calavo Growers vs. The Chefs Warehouse | Calavo Growers vs. Hf Foods Group |
| Sendas Distribuidora vs. Hf Foods Group | Sendas Distribuidora vs. Innovative Food Hldg | Sendas Distribuidora vs. Calavo Growers | Sendas Distribuidora vs. The Chefs Warehouse |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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