Correlation Between Sysco and Metro AG
Can any of the company-specific risk be diversified away by investing in both Sysco and Metro AG 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 Sysco and Metro AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sysco and Metro AG, you can compare the effects of market volatilities on Sysco and Metro AG 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 Sysco with a short position of Metro AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sysco and Metro AG.
Diversification Opportunities for Sysco and Metro AG
Good diversification
The 3 months correlation between Sysco and Metro is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Sysco and Metro AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro AG and Sysco 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 Sysco are associated (or correlated) with Metro AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro AG has no effect on the direction of Sysco i.e., Sysco and Metro AG go up and down completely randomly.
Pair Corralation between Sysco and Metro AG
Assuming the 90 days horizon Sysco is expected to generate 0.41 times more return on investment than Metro AG. However, Sysco is 2.42 times less risky than Metro AG. It trades about 0.0 of its potential returns per unit of risk. Metro AG is currently generating about -0.01 per unit of risk. If you would invest 7,398 in Sysco on September 3, 2024 and sell it today you would lose (176.00) from holding Sysco or give up 2.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sysco vs. Metro AG
Performance |
| Timeline |
| Sysco |
| Metro AG |
Sysco and Metro AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sysco and Metro AG
The main advantage of trading using opposite Sysco and Metro AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sysco position performs unexpectedly, Metro AG 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 Metro AG will offset losses from the drop in Metro AG's long position.| Sysco vs. Cleanaway Waste Management | Sysco vs. Clean Energy Fuels | Sysco vs. Beazer Homes USA | Sysco vs. Neinor Homes SA |
| Metro AG vs. BROADSTNET LEADL 00025 | Metro AG vs. Tyson Foods | Metro AG vs. Astral Foods Limited | Metro AG vs. Warner Music 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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