Correlation Between Ingles Markets and Almacenes Xito
Can any of the company-specific risk be diversified away by investing in both Ingles Markets and Almacenes Xito 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 Almacenes Xito 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 Almacenes xito SA, you can compare the effects of market volatilities on Ingles Markets and Almacenes Xito 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 Almacenes Xito. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingles Markets and Almacenes Xito.
Diversification Opportunities for Ingles Markets and Almacenes Xito
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ingles and Almacenes is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ingles Markets Incorporated and Almacenes xito SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almacenes xito SA 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 Almacenes Xito. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almacenes xito SA has no effect on the direction of Ingles Markets i.e., Ingles Markets and Almacenes Xito go up and down completely randomly.
Pair Corralation between Ingles Markets and Almacenes Xito
Assuming the 90 days horizon Ingles Markets Incorporated is expected to generate 1.14 times more return on investment than Almacenes Xito. However, Ingles Markets is 1.14 times more volatile than Almacenes xito SA. It trades about 0.24 of its potential returns per unit of risk. Almacenes xito SA is currently generating about -0.28 per unit of risk. If you would invest 6,303 in Ingles Markets Incorporated on August 24, 2024 and sell it today you would earn a total of 730.00 from holding Ingles Markets Incorporated or generate 11.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingles Markets Incorporated vs. Almacenes xito SA
Performance |
| Timeline |
| Ingles Markets |
| Almacenes xito SA |
Ingles Markets and Almacenes Xito Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingles Markets and Almacenes Xito
The main advantage of trading using opposite Ingles Markets and Almacenes Xito positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingles Markets position performs unexpectedly, Almacenes Xito 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 Almacenes Xito will offset losses from the drop in Almacenes Xito's long position.| Ingles Markets vs. Weis Markets | Ingles Markets vs. Natural Grocers by | Ingles Markets vs. Sendas Distribuidora SA | Ingles Markets vs. Grocery Outlet Holding |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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