Correlation Between Supermarket Income and Sligro Food
Can any of the company-specific risk be diversified away by investing in both Supermarket Income and Sligro Food 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 Sligro Food 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 Sligro Food Group, you can compare the effects of market volatilities on Supermarket Income and Sligro Food 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 Sligro Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supermarket Income and Sligro Food.
Diversification Opportunities for Supermarket Income and Sligro Food
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Supermarket and Sligro is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Supermarket Income REIT and Sligro Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sligro Food Group 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 Sligro Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sligro Food Group has no effect on the direction of Supermarket Income i.e., Supermarket Income and Sligro Food go up and down completely randomly.
Pair Corralation between Supermarket Income and Sligro Food
Assuming the 90 days trading horizon Supermarket Income REIT is expected to generate 0.95 times more return on investment than Sligro Food. However, Supermarket Income REIT is 1.06 times less risky than Sligro Food. It trades about -0.03 of its potential returns per unit of risk. Sligro Food Group is currently generating about -0.37 per unit of risk. If you would invest 7,170 in Supermarket Income REIT on August 30, 2024 and sell it today you would lose (50.00) from holding Supermarket Income REIT or give up 0.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Supermarket Income REIT vs. Sligro Food Group
Performance |
| Timeline |
| Supermarket Income REIT |
| Sligro Food Group |
Supermarket Income and Sligro Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supermarket Income and Sligro Food
The main advantage of trading using opposite Supermarket Income and Sligro Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supermarket Income position performs unexpectedly, Sligro Food 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 Sligro Food will offset losses from the drop in Sligro Food's long position.| Supermarket Income vs. Fevertree Drinks Plc | Supermarket Income vs. Check Point Software | Supermarket Income vs. International Biotechnology Trust | Supermarket Income vs. Pfeiffer Vacuum Technology |
| Sligro Food vs. Park Hotels Resorts | Sligro Food vs. Elmos Semiconductor SE | Sligro Food vs. Take Two Interactive Software | Sligro Food vs. Dalata Hotel Group |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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