Correlation Between Grocery Outlet and Wing Yip
Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and Wing Yip 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 Wing Yip 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 Wing Yip Food, you can compare the effects of market volatilities on Grocery Outlet and Wing Yip 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 Wing Yip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and Wing Yip.
Diversification Opportunities for Grocery Outlet and Wing Yip
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grocery and Wing is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and Wing Yip Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wing Yip Food 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 Wing Yip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wing Yip Food has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and Wing Yip go up and down completely randomly.
Pair Corralation between Grocery Outlet and Wing Yip
Allowing for the 90-day total investment horizon Grocery Outlet is expected to generate 94.38 times less return on investment than Wing Yip. But when comparing it to its historical volatility, Grocery Outlet Holding is 99.62 times less risky than Wing Yip. It trades about 0.4 of its potential returns per unit of risk. Wing Yip Food is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Wing Yip Food on September 5, 2024 and sell it today you would earn a total of 445.00 from holding Wing Yip Food or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 31.82% |
| Values | Daily Returns |
Grocery Outlet Holding vs. Wing Yip Food
Performance |
| Timeline |
| Grocery Outlet Holding |
| Wing Yip Food |
Grocery Outlet and Wing Yip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grocery Outlet and Wing Yip
The main advantage of trading using opposite Grocery Outlet and Wing Yip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grocery Outlet position performs unexpectedly, Wing Yip 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 Wing Yip will offset losses from the drop in Wing Yip'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 |
| Wing Yip vs. Kellanova | Wing Yip vs. Lamb Weston Holdings | Wing Yip vs. Borealis Foods | Wing Yip vs. Westrock Coffee |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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