Correlation Between SPORTING and SLR Investment
Can any of the company-specific risk be diversified away by investing in both SPORTING and SLR Investment 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 SPORTING and SLR Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPORTING and SLR Investment Corp, you can compare the effects of market volatilities on SPORTING and SLR Investment 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 SPORTING with a short position of SLR Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPORTING and SLR Investment.
Diversification Opportunities for SPORTING and SLR Investment
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SPORTING and SLR is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding SPORTING and SLR Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SLR Investment Corp and SPORTING 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 SPORTING are associated (or correlated) with SLR Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SLR Investment Corp has no effect on the direction of SPORTING i.e., SPORTING and SLR Investment go up and down completely randomly.
Pair Corralation between SPORTING and SLR Investment
Assuming the 90 days trading horizon SPORTING is expected to under-perform the SLR Investment. But the stock apears to be less risky and, when comparing its historical volatility, SPORTING is 9.97 times less risky than SLR Investment. The stock trades about -0.21 of its potential returns per unit of risk. The SLR Investment Corp is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,412 in SLR Investment Corp on August 31, 2024 and sell it today you would earn a total of 158.00 from holding SLR Investment Corp or generate 11.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPORTING vs. SLR Investment Corp
Performance |
| Timeline |
| SPORTING |
| SLR Investment Corp |
SPORTING and SLR Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPORTING and SLR Investment
The main advantage of trading using opposite SPORTING and SLR Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPORTING position performs unexpectedly, SLR Investment 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 SLR Investment will offset losses from the drop in SLR Investment's long position.| SPORTING vs. SIVERS SEMICONDUCTORS AB | SPORTING vs. Darden Restaurants | SPORTING vs. Reliance Steel Aluminum | SPORTING vs. Q2M Managementberatung AG |
| SLR Investment vs. Astral Foods Limited | SLR Investment vs. Collins Foods Limited | SLR Investment vs. United Natural Foods | SLR Investment vs. GRIFFIN MINING 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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