Correlation Between Kroger and G2D Investments
Can any of the company-specific risk be diversified away by investing in both Kroger and G2D Investments 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 Kroger and G2D Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Kroger Co and G2D Investments, you can compare the effects of market volatilities on Kroger and G2D Investments 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 Kroger with a short position of G2D Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kroger and G2D Investments.
Diversification Opportunities for Kroger and G2D Investments
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kroger and G2D is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding The Kroger Co and G2D Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G2D Investments and Kroger 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 The Kroger Co are associated (or correlated) with G2D Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G2D Investments has no effect on the direction of Kroger i.e., Kroger and G2D Investments go up and down completely randomly.
Pair Corralation between Kroger and G2D Investments
Assuming the 90 days trading horizon The Kroger Co is expected to generate 0.59 times more return on investment than G2D Investments. However, The Kroger Co is 1.7 times less risky than G2D Investments. It trades about 0.07 of its potential returns per unit of risk. G2D Investments is currently generating about 0.0 per unit of risk. If you would invest 21,757 in The Kroger Co on October 30, 2024 and sell it today you would earn a total of 13,901 from holding The Kroger Co or generate 63.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
The Kroger Co vs. G2D Investments
Performance |
| Timeline |
| The Kroger |
| G2D Investments |
Kroger and G2D Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kroger and G2D Investments
The main advantage of trading using opposite Kroger and G2D Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kroger position performs unexpectedly, G2D Investments 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 G2D Investments will offset losses from the drop in G2D Investments' long position.| Kroger vs. MAHLE Metal Leve | Kroger vs. Marfrig Global Foods | Kroger vs. Take Two Interactive Software | Kroger vs. Nordon Indstrias Metalrgicas |
| G2D Investments vs. Broadridge Financial Solutions, | G2D Investments vs. Take Two Interactive Software | G2D Investments vs. Prudential Financial | G2D Investments vs. Paycom Software |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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