Correlation Between Supermarket Income and Cardinal Health
Can any of the company-specific risk be diversified away by investing in both Supermarket Income and Cardinal Health 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 Supermarket Income and Cardinal Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Supermarket Income REIT and Cardinal Health, you can compare the effects of market volatilities on Supermarket Income and Cardinal Health 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 Supermarket Income with a short position of Cardinal Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supermarket Income and Cardinal Health.
Diversification Opportunities for Supermarket Income and Cardinal Health
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Supermarket and Cardinal is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Supermarket Income REIT and Cardinal Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardinal Health and Supermarket Income 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 Supermarket Income REIT are associated (or correlated) with Cardinal Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardinal Health has no effect on the direction of Supermarket Income i.e., Supermarket Income and Cardinal Health go up and down completely randomly.
Pair Corralation between Supermarket Income and Cardinal Health
Assuming the 90 days trading horizon Supermarket Income REIT is expected to under-perform the Cardinal Health. But the stock apears to be less risky and, when comparing its historical volatility, Supermarket Income REIT is 1.77 times less risky than Cardinal Health. The stock trades about -0.09 of its potential returns per unit of risk. The Cardinal Health is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 11,192 in Cardinal Health on September 13, 2024 and sell it today you would earn a total of 521.00 from holding Cardinal Health or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Supermarket Income REIT vs. Cardinal Health
Performance |
| Timeline |
| Supermarket Income REIT |
| Cardinal Health |
Supermarket Income and Cardinal Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supermarket Income and Cardinal Health
The main advantage of trading using opposite Supermarket Income and Cardinal Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supermarket Income position performs unexpectedly, Cardinal Health 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 Cardinal Health will offset losses from the drop in Cardinal Health's long position.| Supermarket Income vs. Derwent London PLC | Supermarket Income vs. Hammerson PLC | Supermarket Income vs. Workspace Group PLC | Supermarket Income vs. DS Smith PLC |
| Cardinal Health vs. MT Bank Corp | Cardinal Health vs. Associated British Foods | Cardinal Health vs. Verizon Communications | Cardinal Health vs. Supermarket Income REIT |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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