Correlation Between United Natural and Games Workshop
Can any of the company-specific risk be diversified away by investing in both United Natural and Games Workshop 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 Games Workshop 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 Games Workshop Group, you can compare the effects of market volatilities on United Natural and Games Workshop 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 Games Workshop. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Natural and Games Workshop.
Diversification Opportunities for United Natural and Games Workshop
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between United and Games is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding United Natural Foods and Games Workshop Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Games Workshop Group 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 Games Workshop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Games Workshop Group has no effect on the direction of United Natural i.e., United Natural and Games Workshop go up and down completely randomly.
Pair Corralation between United Natural and Games Workshop
Assuming the 90 days horizon United Natural Foods is expected to generate 0.86 times more return on investment than Games Workshop. However, United Natural Foods is 1.17 times less risky than Games Workshop. It trades about 0.34 of its potential returns per unit of risk. Games Workshop Group is currently generating about 0.22 per unit of risk. If you would invest 1,888 in United Natural Foods on September 1, 2024 and sell it today you would earn a total of 402.00 from holding United Natural Foods or generate 21.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
United Natural Foods vs. Games Workshop Group
Performance |
| Timeline |
| United Natural Foods |
| Games Workshop Group |
United Natural and Games Workshop Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Natural and Games Workshop
The main advantage of trading using opposite United Natural and Games Workshop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Natural position performs unexpectedly, Games Workshop 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 Games Workshop will offset losses from the drop in Games Workshop's long position.| United Natural vs. Sysco | United Natural vs. Jernimo Martins SGPS | United Natural vs. Performance Food Group | United Natural vs. US Foods Holding |
| Games Workshop vs. SLR Investment Corp | Games Workshop vs. BROADSTNET LEADL 00025 | Games Workshop vs. TRAINLINE PLC LS | Games Workshop vs. REGAL ASIAN INVESTMENTS |
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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