Correlation Between US FOODS and Take-Two Interactive
Can any of the company-specific risk be diversified away by investing in both US FOODS and Take-Two Interactive 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 Take-Two Interactive 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 Take Two Interactive Software, you can compare the effects of market volatilities on US FOODS and Take-Two Interactive 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 Take-Two Interactive. Check out your portfolio center. Please also check ongoing floating volatility patterns of US FOODS and Take-Two Interactive.
Diversification Opportunities for US FOODS and Take-Two Interactive
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between UFH and Take-Two is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding US FOODS HOLDING and Take Two Interactive Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Take Two Interactive 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 Take-Two Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Take Two Interactive has no effect on the direction of US FOODS i.e., US FOODS and Take-Two Interactive go up and down completely randomly.
Pair Corralation between US FOODS and Take-Two Interactive
Assuming the 90 days trading horizon US FOODS HOLDING is expected to generate 0.82 times more return on investment than Take-Two Interactive. However, US FOODS HOLDING is 1.22 times less risky than Take-Two Interactive. It trades about 0.1 of its potential returns per unit of risk. Take Two Interactive Software is currently generating about 0.07 per unit of risk. If you would invest 3,460 in US FOODS HOLDING on November 6, 2024 and sell it today you would earn a total of 3,390 from holding US FOODS HOLDING or generate 97.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
US FOODS HOLDING vs. Take Two Interactive Software
Performance |
| Timeline |
| US FOODS HOLDING |
| Take Two Interactive |
US FOODS and Take-Two Interactive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US FOODS and Take-Two Interactive
The main advantage of trading using opposite US FOODS and Take-Two Interactive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US FOODS position performs unexpectedly, Take-Two Interactive 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 Take-Two Interactive will offset losses from the drop in Take-Two Interactive's long position.| US FOODS vs. Amkor Technology | US FOODS vs. VELA TECHNOLPLC LS 0001 | US FOODS vs. TAL Education Group | US FOODS vs. G8 EDUCATION |
| Take-Two Interactive vs. BlueScope Steel Limited | Take-Two Interactive vs. G III Apparel Group | Take-Two Interactive vs. MOUNT GIBSON IRON | Take-Two Interactive vs. HEMISPHERE EGY |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |