Correlation Between Pure Foods and Super Retail
Can any of the company-specific risk be diversified away by investing in both Pure Foods and Super Retail 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 Pure Foods and Super Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pure Foods Tasmania and Super Retail Group, you can compare the effects of market volatilities on Pure Foods and Super Retail 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 Pure Foods with a short position of Super Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pure Foods and Super Retail.
Diversification Opportunities for Pure Foods and Super Retail
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pure and Super is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Pure Foods Tasmania and Super Retail Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Super Retail Group and Pure 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 Pure Foods Tasmania are associated (or correlated) with Super Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Super Retail Group has no effect on the direction of Pure Foods i.e., Pure Foods and Super Retail go up and down completely randomly.
Pair Corralation between Pure Foods and Super Retail
If you would invest 1,484 in Super Retail Group on October 12, 2024 and sell it today you would earn a total of 44.00 from holding Super Retail Group or generate 2.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pure Foods Tasmania vs. Super Retail Group
Performance |
| Timeline |
| Pure Foods Tasmania |
| Super Retail Group |
Pure Foods and Super Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pure Foods and Super Retail
The main advantage of trading using opposite Pure Foods and Super Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pure Foods position performs unexpectedly, Super Retail 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 Super Retail will offset losses from the drop in Super Retail's long position.| Pure Foods vs. My Foodie Box | Pure Foods vs. The Environmental Group | Pure Foods vs. Cleanaway Waste Management | Pure Foods vs. Mount Gibson Iron |
| Super Retail vs. Global Health | Super Retail vs. Oceania Healthcare | Super Retail vs. Health and Plant | Super Retail vs. Pure Foods Tasmania |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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