Correlation Between European Residential and Goodfood Market
Can any of the company-specific risk be diversified away by investing in both European Residential 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 European Residential and Goodfood Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between European Residential Real and Goodfood Market Corp, you can compare the effects of market volatilities on European Residential 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 European Residential with a short position of Goodfood Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of European Residential and Goodfood Market.
Diversification Opportunities for European Residential and Goodfood Market
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between European and Goodfood is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding European Residential Real 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 European Residential 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 European Residential Real 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 European Residential i.e., European Residential and Goodfood Market go up and down completely randomly.
Pair Corralation between European Residential and Goodfood Market
Assuming the 90 days trading horizon European Residential Real is expected to generate 0.74 times more return on investment than Goodfood Market. However, European Residential Real is 1.36 times less risky than Goodfood Market. It trades about 0.16 of its potential returns per unit of risk. Goodfood Market Corp is currently generating about -0.38 per unit of risk. If you would invest 236.00 in European Residential Real on November 27, 2024 and sell it today you would earn a total of 13.00 from holding European Residential Real or generate 5.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
European Residential Real vs. Goodfood Market Corp
Performance |
| Timeline |
| European Residential Real |
| Goodfood Market Corp |
European Residential and Goodfood Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with European Residential and Goodfood Market
The main advantage of trading using opposite European Residential and Goodfood Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if European Residential 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.| European Residential vs. BSR Real Estate | European Residential vs. Minto Apartment Real | European Residential vs. Nexus Real Estate | European Residential vs. Morguard North American |
| Goodfood Market vs. WELL Health Technologies | Goodfood Market vs. Lightspeed Commerce | Goodfood Market vs. Docebo Inc | Goodfood Market vs. Dye Durham |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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