Correlation Between Smurfit WestRock and Almacenes Xito
Can any of the company-specific risk be diversified away by investing in both Smurfit WestRock and Almacenes Xito 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 Smurfit WestRock and Almacenes Xito into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smurfit WestRock plc and Almacenes xito SA, you can compare the effects of market volatilities on Smurfit WestRock and Almacenes Xito 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 Smurfit WestRock with a short position of Almacenes Xito. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smurfit WestRock and Almacenes Xito.
Diversification Opportunities for Smurfit WestRock and Almacenes Xito
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Smurfit and Almacenes is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Smurfit WestRock plc and Almacenes xito SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almacenes xito SA and Smurfit WestRock 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 Smurfit WestRock plc are associated (or correlated) with Almacenes Xito. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almacenes xito SA has no effect on the direction of Smurfit WestRock i.e., Smurfit WestRock and Almacenes Xito go up and down completely randomly.
Pair Corralation between Smurfit WestRock and Almacenes Xito
Allowing for the 90-day total investment horizon Smurfit WestRock plc is expected to generate 1.07 times more return on investment than Almacenes Xito. However, Smurfit WestRock is 1.07 times more volatile than Almacenes xito SA. It trades about 0.04 of its potential returns per unit of risk. Almacenes xito SA is currently generating about -0.03 per unit of risk. If you would invest 4,348 in Smurfit WestRock plc on August 27, 2024 and sell it today you would earn a total of 1,316 from holding Smurfit WestRock plc or generate 30.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.54% |
| Values | Daily Returns |
Smurfit WestRock plc vs. Almacenes xito SA
Performance |
| Timeline |
| Smurfit WestRock plc |
| Almacenes xito SA |
Smurfit WestRock and Almacenes Xito Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smurfit WestRock and Almacenes Xito
The main advantage of trading using opposite Smurfit WestRock and Almacenes Xito positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smurfit WestRock position performs unexpectedly, Almacenes Xito 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 Almacenes Xito will offset losses from the drop in Almacenes Xito's long position.| Smurfit WestRock vs. NETGEAR | Smurfit WestRock vs. Deluxe | Smurfit WestRock vs. BCE Inc | Smurfit WestRock vs. Freedom Internet Group |
| Almacenes Xito vs. MOGU Inc | Almacenes Xito vs. iPower Inc | Almacenes Xito vs. Jeffs Brands | Almacenes Xito vs. Kidpik Corp |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |