Correlation Between Maple Leaf and Slate Grocery
Can any of the company-specific risk be diversified away by investing in both Maple Leaf and Slate Grocery 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 Maple Leaf and Slate Grocery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maple Leaf Foods and Slate Grocery REIT, you can compare the effects of market volatilities on Maple Leaf and Slate Grocery 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 Maple Leaf with a short position of Slate Grocery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maple Leaf and Slate Grocery.
Diversification Opportunities for Maple Leaf and Slate Grocery
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Maple and Slate is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Maple Leaf Foods and Slate Grocery REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Slate Grocery REIT and Maple Leaf 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 Maple Leaf Foods are associated (or correlated) with Slate Grocery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Slate Grocery REIT has no effect on the direction of Maple Leaf i.e., Maple Leaf and Slate Grocery go up and down completely randomly.
Pair Corralation between Maple Leaf and Slate Grocery
Assuming the 90 days trading horizon Maple Leaf Foods is expected to under-perform the Slate Grocery. But the stock apears to be less risky and, when comparing its historical volatility, Maple Leaf Foods is 1.06 times less risky than Slate Grocery. The stock trades about -0.02 of its potential returns per unit of risk. The Slate Grocery REIT is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 843.00 in Slate Grocery REIT on September 3, 2024 and sell it today you would earn a total of 217.00 from holding Slate Grocery REIT or generate 25.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maple Leaf Foods vs. Slate Grocery REIT
Performance |
| Timeline |
| Maple Leaf Foods |
| Slate Grocery REIT |
Maple Leaf and Slate Grocery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maple Leaf and Slate Grocery
The main advantage of trading using opposite Maple Leaf and Slate Grocery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maple Leaf position performs unexpectedly, Slate Grocery 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 Slate Grocery will offset losses from the drop in Slate Grocery's long position.| Maple Leaf vs. Saputo Inc | Maple Leaf vs. George Weston Limited | Maple Leaf vs. Empire Company Limited | Maple Leaf vs. Premium Brands Holdings |
| Slate Grocery vs. Dream Office Real | Slate Grocery vs. Profound Medical Corp | Slate Grocery vs. Brookfield Office Properties | Slate Grocery vs. Economic Investment Trust |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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