Correlation Between Just Eat and Koninklijke Ahold
Can any of the company-specific risk be diversified away by investing in both Just Eat and Koninklijke Ahold 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 Just Eat and Koninklijke Ahold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Just Eat Takeaway and Koninklijke Ahold Delhaize, you can compare the effects of market volatilities on Just Eat and Koninklijke Ahold 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 Just Eat with a short position of Koninklijke Ahold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Just Eat and Koninklijke Ahold.
Diversification Opportunities for Just Eat and Koninklijke Ahold
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Just and Koninklijke is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Just Eat Takeaway and Koninklijke Ahold Delhaize in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koninklijke Ahold and Just Eat 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 Just Eat Takeaway are associated (or correlated) with Koninklijke Ahold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koninklijke Ahold has no effect on the direction of Just Eat i.e., Just Eat and Koninklijke Ahold go up and down completely randomly.
Pair Corralation between Just Eat and Koninklijke Ahold
Assuming the 90 days trading horizon Just Eat Takeaway is expected to generate 3.65 times more return on investment than Koninklijke Ahold. However, Just Eat is 3.65 times more volatile than Koninklijke Ahold Delhaize. It trades about 0.26 of its potential returns per unit of risk. Koninklijke Ahold Delhaize is currently generating about 0.29 per unit of risk. If you would invest 1,111 in Just Eat Takeaway on August 24, 2024 and sell it today you would earn a total of 290.00 from holding Just Eat Takeaway or generate 26.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Just Eat Takeaway vs. Koninklijke Ahold Delhaize
Performance |
| Timeline |
| Just Eat Takeaway |
| Koninklijke Ahold |
Just Eat and Koninklijke Ahold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Just Eat and Koninklijke Ahold
The main advantage of trading using opposite Just Eat and Koninklijke Ahold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Just Eat position performs unexpectedly, Koninklijke Ahold 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 Koninklijke Ahold will offset losses from the drop in Koninklijke Ahold's long position.| Just Eat vs. Prosus NV | Just Eat vs. Koninklijke Ahold Delhaize | Just Eat vs. Adyen NV | Just Eat vs. ASML Holding NV |
| Koninklijke Ahold vs. Unilever PLC | Koninklijke Ahold vs. Koninklijke Philips NV | Koninklijke Ahold vs. NN Group NV | Koninklijke Ahold vs. ING Groep NV |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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