Correlation Between Grocery Outlet and AlphaVest Acquisition
Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and AlphaVest Acquisition 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 Grocery Outlet and AlphaVest Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grocery Outlet Holding and AlphaVest Acquisition Corp, you can compare the effects of market volatilities on Grocery Outlet and AlphaVest Acquisition 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 Grocery Outlet with a short position of AlphaVest Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and AlphaVest Acquisition.
Diversification Opportunities for Grocery Outlet and AlphaVest Acquisition
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grocery and AlphaVest is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and AlphaVest Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AlphaVest Acquisition and Grocery Outlet 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 Grocery Outlet Holding are associated (or correlated) with AlphaVest Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AlphaVest Acquisition has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and AlphaVest Acquisition go up and down completely randomly.
Pair Corralation between Grocery Outlet and AlphaVest Acquisition
Allowing for the 90-day total investment horizon Grocery Outlet Holding is expected to generate 35.48 times more return on investment than AlphaVest Acquisition. However, Grocery Outlet is 35.48 times more volatile than AlphaVest Acquisition Corp. It trades about 0.1 of its potential returns per unit of risk. AlphaVest Acquisition Corp is currently generating about 0.3 per unit of risk. If you would invest 1,627 in Grocery Outlet Holding on September 12, 2024 and sell it today you would earn a total of 332.00 from holding Grocery Outlet Holding or generate 20.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grocery Outlet Holding vs. AlphaVest Acquisition Corp
Performance |
| Timeline |
| Grocery Outlet Holding |
| AlphaVest Acquisition |
Grocery Outlet and AlphaVest Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grocery Outlet and AlphaVest Acquisition
The main advantage of trading using opposite Grocery Outlet and AlphaVest Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grocery Outlet position performs unexpectedly, AlphaVest Acquisition 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 AlphaVest Acquisition will offset losses from the drop in AlphaVest Acquisition's long position.| Grocery Outlet vs. Natural Grocers by | Grocery Outlet vs. Village Super Market | Grocery Outlet vs. Ingles Markets Incorporated | Grocery Outlet vs. Ocado Group plc |
| AlphaVest Acquisition vs. HUMANA INC | AlphaVest Acquisition vs. Barloworld Ltd ADR | AlphaVest Acquisition vs. Morningstar Unconstrained Allocation | AlphaVest Acquisition vs. Thrivent High Yield |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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