Correlation Between Grocery Outlet and Maison Solutions
Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and Maison Solutions 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 Maison Solutions 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 Maison Solutions, you can compare the effects of market volatilities on Grocery Outlet and Maison Solutions 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 Maison Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and Maison Solutions.
Diversification Opportunities for Grocery Outlet and Maison Solutions
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grocery and Maison is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and Maison Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maison Solutions 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 Maison Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maison Solutions has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and Maison Solutions go up and down completely randomly.
Pair Corralation between Grocery Outlet and Maison Solutions
Allowing for the 90-day total investment horizon Grocery Outlet Holding is expected to generate 0.68 times more return on investment than Maison Solutions. However, Grocery Outlet Holding is 1.47 times less risky than Maison Solutions. It trades about 0.12 of its potential returns per unit of risk. Maison Solutions is currently generating about -0.12 per unit of risk. If you would invest 1,632 in Grocery Outlet Holding on November 9, 2024 and sell it today you would earn a total of 99.00 from holding Grocery Outlet Holding or generate 6.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grocery Outlet Holding vs. Maison Solutions
Performance |
| Timeline |
| Grocery Outlet Holding |
| Maison Solutions |
Grocery Outlet and Maison Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grocery Outlet and Maison Solutions
The main advantage of trading using opposite Grocery Outlet and Maison Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grocery Outlet position performs unexpectedly, Maison Solutions 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 Maison Solutions will offset losses from the drop in Maison Solutions' 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 |
| Maison Solutions vs. Q2 Holdings | Maison Solutions vs. Life360, Common Stock | Maison Solutions vs. Insteel Industries | Maison Solutions vs. Joint Stock |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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