Correlation Between Sprouts Farmers and Gecina SA
Can any of the company-specific risk be diversified away by investing in both Sprouts Farmers and Gecina SA 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 Sprouts Farmers and Gecina SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sprouts Farmers Market and Gecina SA, you can compare the effects of market volatilities on Sprouts Farmers and Gecina SA 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 Sprouts Farmers with a short position of Gecina SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sprouts Farmers and Gecina SA.
Diversification Opportunities for Sprouts Farmers and Gecina SA
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sprouts and Gecina is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sprouts Farmers Market and Gecina SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gecina SA and Sprouts Farmers 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 Sprouts Farmers Market are associated (or correlated) with Gecina SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gecina SA has no effect on the direction of Sprouts Farmers i.e., Sprouts Farmers and Gecina SA go up and down completely randomly.
Pair Corralation between Sprouts Farmers and Gecina SA
Considering the 90-day investment horizon Sprouts Farmers Market is expected to generate 0.65 times more return on investment than Gecina SA. However, Sprouts Farmers Market is 1.55 times less risky than Gecina SA. It trades about 0.26 of its potential returns per unit of risk. Gecina SA is currently generating about -0.01 per unit of risk. If you would invest 7,874 in Sprouts Farmers Market on September 3, 2024 and sell it today you would earn a total of 7,218 from holding Sprouts Farmers Market or generate 91.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sprouts Farmers Market vs. Gecina SA
Performance |
| Timeline |
| Sprouts Farmers Market |
| Gecina SA |
Sprouts Farmers and Gecina SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sprouts Farmers and Gecina SA
The main advantage of trading using opposite Sprouts Farmers and Gecina SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sprouts Farmers position performs unexpectedly, Gecina SA 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 Gecina SA will offset losses from the drop in Gecina SA's long position.| Sprouts Farmers vs. Sendas Distribuidora SA | Sprouts Farmers vs. Natural Grocers by | Sprouts Farmers vs. Albertsons Companies | Sprouts Farmers vs. Ingles Markets Incorporated |
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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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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