Correlation Between Ingles Markets and Coles
Can any of the company-specific risk be diversified away by investing in both Ingles Markets and Coles 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 Ingles Markets and Coles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingles Markets Incorporated and Coles Group, you can compare the effects of market volatilities on Ingles Markets and Coles 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 Ingles Markets with a short position of Coles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingles Markets and Coles.
Diversification Opportunities for Ingles Markets and Coles
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ingles and Coles is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Ingles Markets Incorporated and Coles Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coles Group and Ingles Markets 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 Ingles Markets Incorporated are associated (or correlated) with Coles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coles Group has no effect on the direction of Ingles Markets i.e., Ingles Markets and Coles go up and down completely randomly.
Pair Corralation between Ingles Markets and Coles
Assuming the 90 days horizon Ingles Markets Incorporated is expected to under-perform the Coles. But the stock apears to be less risky and, when comparing its historical volatility, Ingles Markets Incorporated is 2.49 times less risky than Coles. The stock trades about -0.02 of its potential returns per unit of risk. The Coles Group is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 821.00 in Coles Group on August 28, 2024 and sell it today you would earn a total of 71.00 from holding Coles Group or generate 8.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 65.07% |
| Values | Daily Returns |
Ingles Markets Incorporated vs. Coles Group
Performance |
| Timeline |
| Ingles Markets |
| Coles Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ingles Markets and Coles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingles Markets and Coles
The main advantage of trading using opposite Ingles Markets and Coles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingles Markets position performs unexpectedly, Coles 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 Coles will offset losses from the drop in Coles' long position.| Ingles Markets vs. Innovative Food Hldg | Ingles Markets vs. Calavo Growers | Ingles Markets vs. The Chefs Warehouse | Ingles Markets vs. AMCON Distributing |
| Coles vs. Seven i Holdings | Coles vs. Grocery Outlet Holding | Coles vs. Krispy Kreme | Coles vs. Koninklijke Ahold Delhaize |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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