Correlation Between Grocery Outlet and Sanyo Special
Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and Sanyo Special 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 Sanyo Special 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 Sanyo Special Steel, you can compare the effects of market volatilities on Grocery Outlet and Sanyo Special 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 Sanyo Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and Sanyo Special.
Diversification Opportunities for Grocery Outlet and Sanyo Special
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Grocery and Sanyo is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and Sanyo Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanyo Special Steel 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 Sanyo Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanyo Special Steel has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and Sanyo Special go up and down completely randomly.
Pair Corralation between Grocery Outlet and Sanyo Special
Allowing for the 90-day total investment horizon Grocery Outlet Holding is expected to generate 50.47 times more return on investment than Sanyo Special. However, Grocery Outlet is 50.47 times more volatile than Sanyo Special Steel. It trades about 0.02 of its potential returns per unit of risk. Sanyo Special Steel is currently generating about 0.09 per unit of risk. If you would invest 2,108 in Grocery Outlet Holding on September 2, 2024 and sell it today you would lose (8.00) from holding Grocery Outlet Holding or give up 0.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grocery Outlet Holding vs. Sanyo Special Steel
Performance |
| Timeline |
| Grocery Outlet Holding |
| Sanyo Special Steel |
Grocery Outlet and Sanyo Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grocery Outlet and Sanyo Special
The main advantage of trading using opposite Grocery Outlet and Sanyo Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grocery Outlet position performs unexpectedly, Sanyo Special 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 Sanyo Special will offset losses from the drop in Sanyo Special'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 |
| Sanyo Special vs. Software Acquisition Group | Sanyo Special vs. National CineMedia | Sanyo Special vs. Fluent Inc | Sanyo Special vs. Deluxe |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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