Correlation Between SPARTAN STORES and QURATE RETAIL
Can any of the company-specific risk be diversified away by investing in both SPARTAN STORES and QURATE RETAIL 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 QURATE RETAIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPARTAN STORES and QURATE RETAIL INC, you can compare the effects of market volatilities on SPARTAN STORES and QURATE RETAIL 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 QURATE RETAIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPARTAN STORES and QURATE RETAIL.
Diversification Opportunities for SPARTAN STORES and QURATE RETAIL
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SPARTAN and QURATE is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding SPARTAN STORES and QURATE RETAIL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QURATE RETAIL INC 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 QURATE RETAIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QURATE RETAIL INC has no effect on the direction of SPARTAN STORES i.e., SPARTAN STORES and QURATE RETAIL go up and down completely randomly.
Pair Corralation between SPARTAN STORES and QURATE RETAIL
Assuming the 90 days trading horizon SPARTAN STORES is expected to under-perform the QURATE RETAIL. But the stock apears to be less risky and, when comparing its historical volatility, SPARTAN STORES is 2.88 times less risky than QURATE RETAIL. The stock trades about -0.03 of its potential returns per unit of risk. The QURATE RETAIL INC is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 605.00 in QURATE RETAIL INC on September 3, 2024 and sell it today you would lose (313.00) from holding QURATE RETAIL INC or give up 51.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPARTAN STORES vs. QURATE RETAIL INC
Performance |
| Timeline |
| SPARTAN STORES |
| QURATE RETAIL INC |
SPARTAN STORES and QURATE RETAIL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPARTAN STORES and QURATE RETAIL
The main advantage of trading using opposite SPARTAN STORES and QURATE RETAIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPARTAN STORES position performs unexpectedly, QURATE RETAIL 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 QURATE RETAIL will offset losses from the drop in QURATE RETAIL's long position.| SPARTAN STORES vs. Playa Hotels Resorts | SPARTAN STORES vs. TYSON FOODS A | SPARTAN STORES vs. Host Hotels Resorts | SPARTAN STORES vs. Pebblebrook Hotel Trust |
| QURATE RETAIL vs. DICKS Sporting Goods | QURATE RETAIL vs. YATRA ONLINE DL 0001 | QURATE RETAIL vs. SALESFORCE INC CDR | QURATE RETAIL vs. COLUMBIA SPORTSWEAR |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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