Correlation Between United Natural and CBRE GROUP-A
Can any of the company-specific risk be diversified away by investing in both United Natural and CBRE GROUP-A 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 CBRE GROUP-A 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 CBRE GROUP A, you can compare the effects of market volatilities on United Natural and CBRE GROUP-A 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 CBRE GROUP-A. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Natural and CBRE GROUP-A.
Diversification Opportunities for United Natural and CBRE GROUP-A
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between United and CBRE is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding United Natural Foods and CBRE GROUP A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBRE GROUP A 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 CBRE GROUP-A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBRE GROUP A has no effect on the direction of United Natural i.e., United Natural and CBRE GROUP-A go up and down completely randomly.
Pair Corralation between United Natural and CBRE GROUP-A
Assuming the 90 days horizon United Natural Foods is expected to generate 1.33 times more return on investment than CBRE GROUP-A. However, United Natural is 1.33 times more volatile than CBRE GROUP A. It trades about 0.14 of its potential returns per unit of risk. CBRE GROUP A is currently generating about 0.08 per unit of risk. If you would invest 2,584 in United Natural Foods on December 2, 2024 and sell it today you would earn a total of 395.00 from holding United Natural Foods or generate 15.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Natural Foods vs. CBRE GROUP A
Performance |
| Timeline |
| United Natural Foods |
| CBRE GROUP A |
United Natural and CBRE GROUP-A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Natural and CBRE GROUP-A
The main advantage of trading using opposite United Natural and CBRE GROUP-A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Natural position performs unexpectedly, CBRE GROUP-A 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 CBRE GROUP-A will offset losses from the drop in CBRE GROUP-A's long position.| United Natural vs. VULCAN MATERIALS | United Natural vs. Applied Materials | United Natural vs. SCIENCE IN SPORT | United Natural vs. Compagnie Plastic Omnium |
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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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