Correlation Between Dole PLC and Sendas Distribuidora
Can any of the company-specific risk be diversified away by investing in both Dole PLC 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 Dole PLC and Sendas Distribuidora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dole PLC and Sendas Distribuidora SA, you can compare the effects of market volatilities on Dole PLC 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 Dole PLC with a short position of Sendas Distribuidora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dole PLC and Sendas Distribuidora.
Diversification Opportunities for Dole PLC and Sendas Distribuidora
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dole and Sendas is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Dole PLC and Sendas Distribuidora SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sendas Distribuidora and Dole PLC 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 Dole PLC 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 Dole PLC i.e., Dole PLC and Sendas Distribuidora go up and down completely randomly.
Pair Corralation between Dole PLC and Sendas Distribuidora
Given the investment horizon of 90 days Dole PLC is expected to generate 0.5 times more return on investment than Sendas Distribuidora. However, Dole PLC is 1.99 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 -0.08 per unit of risk. If you would invest 1,077 in Dole PLC on November 9, 2024 and sell it today you would earn a total of 299.00 from holding Dole PLC or generate 27.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.55% |
| Values | Daily Returns |
Dole PLC vs. Sendas Distribuidora SA
Performance |
| Timeline |
| Dole PLC |
| Sendas Distribuidora |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Dole PLC and Sendas Distribuidora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dole PLC and Sendas Distribuidora
The main advantage of trading using opposite Dole PLC and Sendas Distribuidora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dole PLC 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.| Dole PLC vs. Limoneira Co | Dole PLC vs. Alico Inc | Dole PLC vs. Adecoagro SA | Dole PLC vs. Cal Maine Foods |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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