Correlation Between Supermarket Income and Impax Asset
Can any of the company-specific risk be diversified away by investing in both Supermarket Income and Impax Asset 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 Impax Asset 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 Impax Asset Management, you can compare the effects of market volatilities on Supermarket Income and Impax Asset 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 Impax Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supermarket Income and Impax Asset.
Diversification Opportunities for Supermarket Income and Impax Asset
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Supermarket and Impax is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Supermarket Income REIT and Impax Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impax Asset Management 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 Impax Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impax Asset Management has no effect on the direction of Supermarket Income i.e., Supermarket Income and Impax Asset go up and down completely randomly.
Pair Corralation between Supermarket Income and Impax Asset
Assuming the 90 days trading horizon Supermarket Income REIT is expected to generate 0.36 times more return on investment than Impax Asset. However, Supermarket Income REIT is 2.81 times less risky than Impax Asset. It trades about -0.05 of its potential returns per unit of risk. Impax Asset Management is currently generating about -0.12 per unit of risk. If you would invest 7,157 in Supermarket Income REIT on October 13, 2024 and sell it today you would lose (557.00) from holding Supermarket Income REIT or give up 7.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Supermarket Income REIT vs. Impax Asset Management
Performance |
| Timeline |
| Supermarket Income REIT |
| Impax Asset Management |
Supermarket Income and Impax Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supermarket Income and Impax Asset
The main advantage of trading using opposite Supermarket Income and Impax Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supermarket Income position performs unexpectedly, Impax Asset 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 Impax Asset will offset losses from the drop in Impax Asset's long position.| Supermarket Income vs. Impax Asset Management | Supermarket Income vs. Bankers Investment Trust | Supermarket Income vs. Zegona Communications Plc | Supermarket Income vs. Deltex Medical Group |
| Impax Asset vs. SMA Solar Technology | Impax Asset vs. DXC Technology Co | Impax Asset vs. Batm Advanced Communications | Impax Asset vs. Allianz Technology Trust |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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