Correlation Between US FOODS and GRUPO CARSO
Can any of the company-specific risk be diversified away by investing in both US FOODS and GRUPO CARSO 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 US FOODS and GRUPO CARSO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US FOODS HOLDING and GRUPO CARSO A1, you can compare the effects of market volatilities on US FOODS and GRUPO CARSO 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 US FOODS with a short position of GRUPO CARSO. Check out your portfolio center. Please also check ongoing floating volatility patterns of US FOODS and GRUPO CARSO.
Diversification Opportunities for US FOODS and GRUPO CARSO
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between UFH and GRUPO is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding US FOODS HOLDING and GRUPO CARSO A1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRUPO CARSO A1 and US FOODS 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 US FOODS HOLDING are associated (or correlated) with GRUPO CARSO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRUPO CARSO A1 has no effect on the direction of US FOODS i.e., US FOODS and GRUPO CARSO go up and down completely randomly.
Pair Corralation between US FOODS and GRUPO CARSO
Assuming the 90 days trading horizon US FOODS is expected to generate 1.84 times less return on investment than GRUPO CARSO. But when comparing it to its historical volatility, US FOODS HOLDING is 2.84 times less risky than GRUPO CARSO. It trades about 0.09 of its potential returns per unit of risk. GRUPO CARSO A1 is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 244.00 in GRUPO CARSO A1 on October 28, 2024 and sell it today you would earn a total of 321.00 from holding GRUPO CARSO A1 or generate 131.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
US FOODS HOLDING vs. GRUPO CARSO A1
Performance |
| Timeline |
| US FOODS HOLDING |
| GRUPO CARSO A1 |
US FOODS and GRUPO CARSO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US FOODS and GRUPO CARSO
The main advantage of trading using opposite US FOODS and GRUPO CARSO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US FOODS position performs unexpectedly, GRUPO CARSO 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 GRUPO CARSO will offset losses from the drop in GRUPO CARSO's long position.| US FOODS vs. Goodyear Tire Rubber | US FOODS vs. ON SEMICONDUCTOR | US FOODS vs. Martin Marietta Materials | US FOODS vs. NEWELL RUBBERMAID |
| GRUPO CARSO vs. Calibre Mining Corp | GRUPO CARSO vs. SBM OFFSHORE | GRUPO CARSO vs. FIREWEED METALS P | GRUPO CARSO vs. Solstad Offshore ASA |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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