Correlation Between Sligro Food and Amsterdam Commodities
Can any of the company-specific risk be diversified away by investing in both Sligro Food and Amsterdam Commodities 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 Sligro Food and Amsterdam Commodities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sligro Food Group and Amsterdam Commodities NV, you can compare the effects of market volatilities on Sligro Food and Amsterdam Commodities 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 Sligro Food with a short position of Amsterdam Commodities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sligro Food and Amsterdam Commodities.
Diversification Opportunities for Sligro Food and Amsterdam Commodities
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sligro and Amsterdam is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Sligro Food Group and Amsterdam Commodities NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amsterdam Commodities and Sligro 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 Sligro Food Group are associated (or correlated) with Amsterdam Commodities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amsterdam Commodities has no effect on the direction of Sligro Food i.e., Sligro Food and Amsterdam Commodities go up and down completely randomly.
Pair Corralation between Sligro Food and Amsterdam Commodities
Assuming the 90 days trading horizon Sligro Food Group is expected to under-perform the Amsterdam Commodities. In addition to that, Sligro Food is 1.3 times more volatile than Amsterdam Commodities NV. It trades about -0.05 of its total potential returns per unit of risk. Amsterdam Commodities NV is currently generating about 0.0 per unit of volatility. If you would invest 1,774 in Amsterdam Commodities NV on August 25, 2024 and sell it today you would lose (10.00) from holding Amsterdam Commodities NV or give up 0.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sligro Food Group vs. Amsterdam Commodities NV
Performance |
| Timeline |
| Sligro Food Group |
| Amsterdam Commodities |
Sligro Food and Amsterdam Commodities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sligro Food and Amsterdam Commodities
The main advantage of trading using opposite Sligro Food and Amsterdam Commodities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sligro Food position performs unexpectedly, Amsterdam Commodities 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 Amsterdam Commodities will offset losses from the drop in Amsterdam Commodities' long position.| Sligro Food vs. TKH Group NV | Sligro Food vs. Brunel International NV | Sligro Food vs. Koninklijke BAM Groep | Sligro Food vs. Koninklijke Vopak NV |
| Amsterdam Commodities vs. Flow Traders BV | Amsterdam Commodities vs. Aalberts Industries NV | Amsterdam Commodities vs. ForFarmers NV | Amsterdam Commodities vs. TKH Group NV |
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 Stocks Directory module to find actively traded stocks across global markets.
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