Correlation Between GWILLI FOOD and Algonquin Power
Can any of the company-specific risk be diversified away by investing in both GWILLI FOOD and Algonquin Power 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 GWILLI FOOD and Algonquin Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GWILLI FOOD and Algonquin Power Utilities, you can compare the effects of market volatilities on GWILLI FOOD and Algonquin Power 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 GWILLI FOOD with a short position of Algonquin Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of GWILLI FOOD and Algonquin Power.
Diversification Opportunities for GWILLI FOOD and Algonquin Power
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GWILLI and Algonquin is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding GWILLI FOOD and Algonquin Power Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Algonquin Power Utilities and GWILLI FOOD 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 GWILLI FOOD are associated (or correlated) with Algonquin Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Algonquin Power Utilities has no effect on the direction of GWILLI FOOD i.e., GWILLI FOOD and Algonquin Power go up and down completely randomly.
Pair Corralation between GWILLI FOOD and Algonquin Power
Assuming the 90 days trading horizon GWILLI FOOD is expected to generate 1.55 times more return on investment than Algonquin Power. However, GWILLI FOOD is 1.55 times more volatile than Algonquin Power Utilities. It trades about 0.03 of its potential returns per unit of risk. Algonquin Power Utilities is currently generating about -0.02 per unit of risk. If you would invest 1,208 in GWILLI FOOD on October 11, 2024 and sell it today you would earn a total of 362.00 from holding GWILLI FOOD or generate 29.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GWILLI FOOD vs. Algonquin Power Utilities
Performance |
| Timeline |
| GWILLI FOOD |
| Algonquin Power Utilities |
GWILLI FOOD and Algonquin Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GWILLI FOOD and Algonquin Power
The main advantage of trading using opposite GWILLI FOOD and Algonquin Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GWILLI FOOD position performs unexpectedly, Algonquin Power 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 Algonquin Power will offset losses from the drop in Algonquin Power's long position.| GWILLI FOOD vs. Tower Semiconductor | GWILLI FOOD vs. ON SEMICONDUCTOR | GWILLI FOOD vs. MTY Food Group | GWILLI FOOD vs. Taiwan Semiconductor Manufacturing |
| Algonquin Power vs. SOGECLAIR SA INH | Algonquin Power vs. INDOFOOD AGRI RES | Algonquin Power vs. GWILLI FOOD | Algonquin Power vs. SEALED AIR |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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