Correlation Between Performance Food and Gruppo Mutuionline
Can any of the company-specific risk be diversified away by investing in both Performance Food and Gruppo Mutuionline 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 Performance Food and Gruppo Mutuionline into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Performance Food Group and Gruppo Mutuionline SpA, you can compare the effects of market volatilities on Performance Food and Gruppo Mutuionline 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 Performance Food with a short position of Gruppo Mutuionline. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performance Food and Gruppo Mutuionline.
Diversification Opportunities for Performance Food and Gruppo Mutuionline
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Performance and Gruppo is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Performance Food Group and Gruppo Mutuionline SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gruppo Mutuionline SpA and Performance Food 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 Performance Food Group are associated (or correlated) with Gruppo Mutuionline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gruppo Mutuionline SpA has no effect on the direction of Performance Food i.e., Performance Food and Gruppo Mutuionline go up and down completely randomly.
Pair Corralation between Performance Food and Gruppo Mutuionline
Assuming the 90 days trading horizon Performance Food Group is expected to generate 0.79 times more return on investment than Gruppo Mutuionline. However, Performance Food Group is 1.27 times less risky than Gruppo Mutuionline. It trades about 0.06 of its potential returns per unit of risk. Gruppo Mutuionline SpA is currently generating about 0.03 per unit of risk. If you would invest 5,600 in Performance Food Group on October 25, 2024 and sell it today you would earn a total of 2,850 from holding Performance Food Group or generate 50.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Performance Food Group vs. Gruppo Mutuionline SpA
Performance |
| Timeline |
| Performance Food |
| Gruppo Mutuionline SpA |
Performance Food and Gruppo Mutuionline Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Performance Food and Gruppo Mutuionline
The main advantage of trading using opposite Performance Food and Gruppo Mutuionline positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performance Food position performs unexpectedly, Gruppo Mutuionline 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 Gruppo Mutuionline will offset losses from the drop in Gruppo Mutuionline's long position.| Performance Food vs. Meiko Electronics Co | Performance Food vs. HYATT HOTELS A | Performance Food vs. PPHE HOTEL GROUP | Performance Food vs. NH HOTEL GROUP |
| Gruppo Mutuionline vs. CENTURIA OFFICE REIT | Gruppo Mutuionline vs. IMAGIN MEDICAL INC | Gruppo Mutuionline vs. CompuGroup Medical SE | Gruppo Mutuionline vs. Genertec Universal Medical |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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