Correlation Between International Consolidated and RETAIL FOOD
Can any of the company-specific risk be diversified away by investing in both International Consolidated and RETAIL FOOD 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 International Consolidated and RETAIL FOOD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Consolidated Airlines and RETAIL FOOD GROUP, you can compare the effects of market volatilities on International Consolidated and RETAIL FOOD 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 International Consolidated with a short position of RETAIL FOOD. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Consolidated and RETAIL FOOD.
Diversification Opportunities for International Consolidated and RETAIL FOOD
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between International and RETAIL is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding International Consolidated Air and RETAIL FOOD GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RETAIL FOOD GROUP and International Consolidated 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 International Consolidated Airlines are associated (or correlated) with RETAIL FOOD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RETAIL FOOD GROUP has no effect on the direction of International Consolidated i.e., International Consolidated and RETAIL FOOD go up and down completely randomly.
Pair Corralation between International Consolidated and RETAIL FOOD
Assuming the 90 days horizon International Consolidated Airlines is expected to generate 0.51 times more return on investment than RETAIL FOOD. However, International Consolidated Airlines is 1.97 times less risky than RETAIL FOOD. It trades about 0.04 of its potential returns per unit of risk. RETAIL FOOD GROUP is currently generating about -0.02 per unit of risk. If you would invest 380.00 in International Consolidated Airlines on November 28, 2024 and sell it today you would earn a total of 5.00 from holding International Consolidated Airlines or generate 1.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Consolidated Air vs. RETAIL FOOD GROUP
Performance |
| Timeline |
| International Consolidated |
| RETAIL FOOD GROUP |
International Consolidated and RETAIL FOOD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Consolidated and RETAIL FOOD
The main advantage of trading using opposite International Consolidated and RETAIL FOOD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Consolidated position performs unexpectedly, RETAIL FOOD 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 RETAIL FOOD will offset losses from the drop in RETAIL FOOD's long position.| International Consolidated vs. COVIVIO HOTELS INH | International Consolidated vs. GEELY AUTOMOBILE | International Consolidated vs. InterContinental Hotels Group | International Consolidated vs. MELIA HOTELS |
| RETAIL FOOD vs. BG Foods | RETAIL FOOD vs. BOSTON BEER A | RETAIL FOOD vs. Thai Beverage Public | RETAIL FOOD vs. Maple Leaf Foods |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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