Correlation Between Grocery Outlet and High Roller
Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and High Roller 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 High Roller 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 High Roller Technologies,, you can compare the effects of market volatilities on Grocery Outlet and High Roller 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 High Roller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and High Roller.
Diversification Opportunities for Grocery Outlet and High Roller
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Grocery and High is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and High Roller Technologies, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Roller Technologies, 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 High Roller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Roller Technologies, has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and High Roller go up and down completely randomly.
Pair Corralation between Grocery Outlet and High Roller
Allowing for the 90-day total investment horizon Grocery Outlet is expected to generate 12.0 times less return on investment than High Roller. But when comparing it to its historical volatility, Grocery Outlet Holding is 2.99 times less risky than High Roller. It trades about 0.02 of its potential returns per unit of risk. High Roller Technologies, is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 589.00 in High Roller Technologies, on September 14, 2024 and sell it today you would earn a total of 41.00 from holding High Roller Technologies, or generate 6.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grocery Outlet Holding vs. High Roller Technologies,
Performance |
| Timeline |
| Grocery Outlet Holding |
| High Roller Technologies, |
Grocery Outlet and High Roller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grocery Outlet and High Roller
The main advantage of trading using opposite Grocery Outlet and High Roller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grocery Outlet position performs unexpectedly, High Roller 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 High Roller will offset losses from the drop in High Roller'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 |
| High Roller vs. Grocery Outlet Holding | High Roller vs. National Vision Holdings | High Roller vs. Pool Corporation | High Roller vs. SunOpta |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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