Correlation Between Slate Grocery and Western Energy
Can any of the company-specific risk be diversified away by investing in both Slate Grocery and Western Energy 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 Slate Grocery and Western Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Slate Grocery REIT and Western Energy Services, you can compare the effects of market volatilities on Slate Grocery and Western Energy 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 Slate Grocery with a short position of Western Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slate Grocery and Western Energy.
Diversification Opportunities for Slate Grocery and Western Energy
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Slate and Western is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Slate Grocery REIT and Western Energy Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Energy Services and Slate Grocery 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 Slate Grocery REIT are associated (or correlated) with Western Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Energy Services has no effect on the direction of Slate Grocery i.e., Slate Grocery and Western Energy go up and down completely randomly.
Pair Corralation between Slate Grocery and Western Energy
Assuming the 90 days trading horizon Slate Grocery is expected to generate 2.37 times less return on investment than Western Energy. But when comparing it to its historical volatility, Slate Grocery REIT is 2.28 times less risky than Western Energy. It trades about 0.03 of its potential returns per unit of risk. Western Energy Services is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 265.00 in Western Energy Services on August 30, 2024 and sell it today you would earn a total of 4.00 from holding Western Energy Services or generate 1.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
Slate Grocery REIT vs. Western Energy Services
Performance |
| Timeline |
| Slate Grocery REIT |
| Western Energy Services |
Slate Grocery and Western Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Slate Grocery and Western Energy
The main advantage of trading using opposite Slate Grocery and Western Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Slate Grocery position performs unexpectedly, Western Energy 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 Western Energy will offset losses from the drop in Western Energy's long position.| Slate Grocery vs. Atrium Mortgage Investment | Slate Grocery vs. Diversified Royalty Corp | Slate Grocery vs. Western Copper and | Slate Grocery vs. Broadcom |
| Western Energy vs. Total Energy Services | Western Energy vs. PHX Energy Services | Western Energy vs. Calfrac Well Services |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |