Correlation Between NH Foods and Dominos Pizza
Can any of the company-specific risk be diversified away by investing in both NH Foods and Dominos Pizza 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 NH Foods and Dominos Pizza into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH Foods Ltd and Dominos Pizza Group, you can compare the effects of market volatilities on NH Foods and Dominos Pizza 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 NH Foods with a short position of Dominos Pizza. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Foods and Dominos Pizza.
Diversification Opportunities for NH Foods and Dominos Pizza
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NIPMY and Dominos is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NH Foods Ltd and Dominos Pizza Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dominos Pizza Group and NH Foods 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 NH Foods Ltd are associated (or correlated) with Dominos Pizza. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dominos Pizza Group has no effect on the direction of NH Foods i.e., NH Foods and Dominos Pizza go up and down completely randomly.
Pair Corralation between NH Foods and Dominos Pizza
Assuming the 90 days horizon NH Foods is expected to generate 1.79 times less return on investment than Dominos Pizza. But when comparing it to its historical volatility, NH Foods Ltd is 4.99 times less risky than Dominos Pizza. It trades about 0.1 of its potential returns per unit of risk. Dominos Pizza Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 346.00 in Dominos Pizza Group on September 3, 2024 and sell it today you would earn a total of 66.00 from holding Dominos Pizza Group or generate 19.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 54.14% |
| Values | Daily Returns |
NH Foods Ltd vs. Dominos Pizza Group
Performance |
| Timeline |
| NH Foods |
| Dominos Pizza Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
NH Foods and Dominos Pizza Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH Foods and Dominos Pizza
The main advantage of trading using opposite NH Foods and Dominos Pizza positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH Foods position performs unexpectedly, Dominos Pizza 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 Dominos Pizza will offset losses from the drop in Dominos Pizza's long position.| NH Foods vs. Kellanova | NH Foods vs. Lancaster Colony | NH Foods vs. The A2 Milk | NH Foods vs. Altavoz Entertainment |
| Dominos Pizza vs. Hafnia Limited | Dominos Pizza vs. Nexstar Broadcasting Group | Dominos Pizza vs. Yuexiu Transport Infrastructure | Dominos Pizza vs. NH Foods Ltd |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |