Correlation Between AMCON Distributing and Sendas Distribuidora
Can any of the company-specific risk be diversified away by investing in both AMCON Distributing 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 AMCON Distributing and Sendas Distribuidora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMCON Distributing and Sendas Distribuidora SA, you can compare the effects of market volatilities on AMCON Distributing 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 AMCON Distributing with a short position of Sendas Distribuidora. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMCON Distributing and Sendas Distribuidora.
Diversification Opportunities for AMCON Distributing and Sendas Distribuidora
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AMCON and Sendas is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding AMCON Distributing and Sendas Distribuidora SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sendas Distribuidora and AMCON Distributing 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 AMCON Distributing 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 AMCON Distributing i.e., AMCON Distributing and Sendas Distribuidora go up and down completely randomly.
Pair Corralation between AMCON Distributing and Sendas Distribuidora
Considering the 90-day investment horizon AMCON Distributing is expected to generate 1.55 times more return on investment than Sendas Distribuidora. However, AMCON Distributing is 1.55 times more volatile than Sendas Distribuidora SA. It trades about 0.09 of its potential returns per unit of risk. Sendas Distribuidora SA is currently generating about -0.06 per unit of risk. If you would invest 12,494 in AMCON Distributing on August 31, 2024 and sell it today you would earn a total of 988.00 from holding AMCON Distributing or generate 7.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMCON Distributing vs. Sendas Distribuidora SA
Performance |
| Timeline |
| AMCON Distributing |
| Sendas Distribuidora |
AMCON Distributing and Sendas Distribuidora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMCON Distributing and Sendas Distribuidora
The main advantage of trading using opposite AMCON Distributing and Sendas Distribuidora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMCON Distributing 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.| AMCON Distributing vs. The Chefs Warehouse | AMCON Distributing vs. G Willi Food International | AMCON Distributing vs. SpartanNash Co | AMCON Distributing 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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