Correlation Between Ocado Group and Sendas Distribuidora
Can any of the company-specific risk be diversified away by investing in both Ocado Group and Sendas Distribuidora 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 Ocado Group and Sendas Distribuidora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ocado Group plc and Sendas Distribuidora SA, you can compare the effects of market volatilities on Ocado Group and Sendas Distribuidora 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 Ocado Group with a short position of Sendas Distribuidora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ocado Group and Sendas Distribuidora.
Diversification Opportunities for Ocado Group and Sendas Distribuidora
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ocado and Sendas is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Ocado Group plc and Sendas Distribuidora SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sendas Distribuidora and Ocado Group 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 Ocado Group plc are associated (or correlated) with Sendas Distribuidora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sendas Distribuidora has no effect on the direction of Ocado Group i.e., Ocado Group and Sendas Distribuidora go up and down completely randomly.
Pair Corralation between Ocado Group and Sendas Distribuidora
Assuming the 90 days horizon Ocado Group plc is expected to generate 1.49 times more return on investment than Sendas Distribuidora. However, Ocado Group is 1.49 times more volatile than Sendas Distribuidora SA. It trades about -0.01 of its potential returns per unit of risk. Sendas Distribuidora SA is currently generating about -0.07 per unit of risk. If you would invest 1,615 in Ocado Group plc on August 24, 2024 and sell it today you would lose (813.00) from holding Ocado Group plc or give up 50.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ocado Group plc vs. Sendas Distribuidora SA
Performance |
| Timeline |
| Ocado Group plc |
| Sendas Distribuidora |
Ocado Group and Sendas Distribuidora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ocado Group and Sendas Distribuidora
The main advantage of trading using opposite Ocado Group and Sendas Distribuidora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ocado Group position performs unexpectedly, Sendas Distribuidora 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 Sendas Distribuidora will offset losses from the drop in Sendas Distribuidora's long position.| Ocado Group vs. Kroger Company | Ocado Group vs. Seven i Holdings | Ocado Group vs. Woolworths Group Limited | Ocado Group vs. Koninklijke Ahold Delhaize |
| Sendas Distribuidora vs. Village Super Market | Sendas Distribuidora vs. Weis Markets | Sendas Distribuidora vs. Ingles Markets Incorporated | Sendas Distribuidora vs. Grocery Outlet Holding |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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