Correlation Between United Natural and SVENSKA AEROGEL
Can any of the company-specific risk be diversified away by investing in both United Natural and SVENSKA AEROGEL 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 United Natural and SVENSKA AEROGEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Natural Foods and SVENSKA AEROGEL HOLDING, you can compare the effects of market volatilities on United Natural and SVENSKA AEROGEL 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 United Natural with a short position of SVENSKA AEROGEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Natural and SVENSKA AEROGEL.
Diversification Opportunities for United Natural and SVENSKA AEROGEL
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between United and SVENSKA is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding United Natural Foods and SVENSKA AEROGEL HOLDING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SVENSKA AEROGEL HOLDING and United Natural 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 United Natural Foods are associated (or correlated) with SVENSKA AEROGEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SVENSKA AEROGEL HOLDING has no effect on the direction of United Natural i.e., United Natural and SVENSKA AEROGEL go up and down completely randomly.
Pair Corralation between United Natural and SVENSKA AEROGEL
Assuming the 90 days horizon United Natural Foods is expected to generate 0.33 times more return on investment than SVENSKA AEROGEL. However, United Natural Foods is 3.04 times less risky than SVENSKA AEROGEL. It trades about 0.19 of its potential returns per unit of risk. SVENSKA AEROGEL HOLDING is currently generating about -0.03 per unit of risk. If you would invest 2,497 in United Natural Foods on October 20, 2024 and sell it today you would earn a total of 192.00 from holding United Natural Foods or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
United Natural Foods vs. SVENSKA AEROGEL HOLDING
Performance |
| Timeline |
| United Natural Foods |
| SVENSKA AEROGEL HOLDING |
United Natural and SVENSKA AEROGEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Natural and SVENSKA AEROGEL
The main advantage of trading using opposite United Natural and SVENSKA AEROGEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Natural position performs unexpectedly, SVENSKA AEROGEL 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 SVENSKA AEROGEL will offset losses from the drop in SVENSKA AEROGEL's long position.| United Natural vs. Columbia Sportswear | United Natural vs. UNIVERSAL MUSIC GROUP | United Natural vs. Zoom Video Communications | United Natural vs. ePlay Digital |
| SVENSKA AEROGEL vs. Corsair Gaming | SVENSKA AEROGEL vs. United Natural Foods | SVENSKA AEROGEL vs. COFCO Joycome Foods | SVENSKA AEROGEL vs. Nomad Foods |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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