Correlation Between Performance Food and Metrospaces
Can any of the company-specific risk be diversified away by investing in both Performance Food and Metrospaces 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 Metrospaces 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 Metrospaces, you can compare the effects of market volatilities on Performance Food and Metrospaces 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 Metrospaces. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performance Food and Metrospaces.
Diversification Opportunities for Performance Food and Metrospaces
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Performance and Metrospaces is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Performance Food Group and Metrospaces in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metrospaces 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 Metrospaces. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metrospaces has no effect on the direction of Performance Food i.e., Performance Food and Metrospaces go up and down completely randomly.
Pair Corralation between Performance Food and Metrospaces
Given the investment horizon of 90 days Performance Food is expected to generate 328.26 times less return on investment than Metrospaces. But when comparing it to its historical volatility, Performance Food Group is 125.45 times less risky than Metrospaces. It trades about 0.07 of its potential returns per unit of risk. Metrospaces is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 0.01 in Metrospaces on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Metrospaces or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Performance Food Group vs. Metrospaces
Performance |
| Timeline |
| Performance Food |
| Metrospaces |
Performance Food and Metrospaces Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Performance Food and Metrospaces
The main advantage of trading using opposite Performance Food and Metrospaces positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performance Food position performs unexpectedly, Metrospaces 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 Metrospaces will offset losses from the drop in Metrospaces' long position.| Performance Food vs. Sysco | Performance Food vs. The Chefs Warehouse | Performance Food vs. United Natural Foods | Performance Food vs. Calavo Growers |
| Metrospaces vs. Jammin Java Corp | Metrospaces vs. Mongolia Growth Group | Metrospaces vs. Ke Holdings | Metrospaces vs. Medican Enterprises |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |