Correlation Between SPARTAN STORES and ImagineAR
Can any of the company-specific risk be diversified away by investing in both SPARTAN STORES and ImagineAR 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 SPARTAN STORES and ImagineAR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPARTAN STORES and ImagineAR, you can compare the effects of market volatilities on SPARTAN STORES and ImagineAR 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 SPARTAN STORES with a short position of ImagineAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPARTAN STORES and ImagineAR.
Diversification Opportunities for SPARTAN STORES and ImagineAR
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SPARTAN and ImagineAR is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding SPARTAN STORES and ImagineAR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ImagineAR and SPARTAN STORES 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 SPARTAN STORES are associated (or correlated) with ImagineAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ImagineAR has no effect on the direction of SPARTAN STORES i.e., SPARTAN STORES and ImagineAR go up and down completely randomly.
Pair Corralation between SPARTAN STORES and ImagineAR
Assuming the 90 days trading horizon SPARTAN STORES is expected to under-perform the ImagineAR. But the stock apears to be less risky and, when comparing its historical volatility, SPARTAN STORES is 6.13 times less risky than ImagineAR. The stock trades about -0.03 of its potential returns per unit of risk. The ImagineAR is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2.65 in ImagineAR on October 11, 2024 and sell it today you would earn a total of 2.20 from holding ImagineAR or generate 83.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPARTAN STORES vs. ImagineAR
Performance |
| Timeline |
| SPARTAN STORES |
| ImagineAR |
SPARTAN STORES and ImagineAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPARTAN STORES and ImagineAR
The main advantage of trading using opposite SPARTAN STORES and ImagineAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPARTAN STORES position performs unexpectedly, ImagineAR 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 ImagineAR will offset losses from the drop in ImagineAR's long position.| SPARTAN STORES vs. GRIFFIN MINING LTD | SPARTAN STORES vs. MCEWEN MINING INC | SPARTAN STORES vs. CarsalesCom | SPARTAN STORES vs. De Grey Mining |
| ImagineAR vs. UNIVERSAL MUSIC GROUP | ImagineAR vs. SPARTAN STORES | ImagineAR vs. National Retail Properties | ImagineAR vs. Jupiter Fund Management |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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