Correlation Between Smart Share and Goodfood Market
Can any of the company-specific risk be diversified away by investing in both Smart Share and Goodfood Market 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 Smart Share and Goodfood Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smart Share Global and Goodfood Market Corp, you can compare the effects of market volatilities on Smart Share and Goodfood Market 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 Smart Share with a short position of Goodfood Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smart Share and Goodfood Market.
Diversification Opportunities for Smart Share and Goodfood Market
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Smart and Goodfood is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Smart Share Global and Goodfood Market Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goodfood Market Corp and Smart Share 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 Smart Share Global are associated (or correlated) with Goodfood Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goodfood Market Corp has no effect on the direction of Smart Share i.e., Smart Share and Goodfood Market go up and down completely randomly.
Pair Corralation between Smart Share and Goodfood Market
Allowing for the 90-day total investment horizon Smart Share Global is expected to under-perform the Goodfood Market. But the stock apears to be less risky and, when comparing its historical volatility, Smart Share Global is 3.83 times less risky than Goodfood Market. The stock trades about -0.09 of its potential returns per unit of risk. The Goodfood Market Corp is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Goodfood Market Corp on August 28, 2024 and sell it today you would earn a total of 13.00 from holding Goodfood Market Corp or generate 65.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Smart Share Global vs. Goodfood Market Corp
Performance |
| Timeline |
| Smart Share Global |
| Goodfood Market Corp |
Smart Share and Goodfood Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smart Share and Goodfood Market
The main advantage of trading using opposite Smart Share and Goodfood Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smart Share position performs unexpectedly, Goodfood Market 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 Goodfood Market will offset losses from the drop in Goodfood Market's long position.| Smart Share vs. Frontdoor | Smart Share vs. Bright Horizons Family | Smart Share vs. Mister Car Wash | Smart Share vs. Carriage Services |
| Goodfood Market vs. FitLife Brands, Common | Goodfood Market vs. HUMANA INC | Goodfood Market vs. SCOR PK | Goodfood Market vs. Aquagold International |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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