Correlation Between United Natural and TRADEGATE
Can any of the company-specific risk be diversified away by investing in both United Natural and TRADEGATE 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 TRADEGATE 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 TRADEGATE, you can compare the effects of market volatilities on United Natural and TRADEGATE 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 TRADEGATE. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Natural and TRADEGATE.
Diversification Opportunities for United Natural and TRADEGATE
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between United and TRADEGATE is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding United Natural Foods and TRADEGATE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRADEGATE 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 TRADEGATE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRADEGATE has no effect on the direction of United Natural i.e., United Natural and TRADEGATE go up and down completely randomly.
Pair Corralation between United Natural and TRADEGATE
Assuming the 90 days horizon United Natural Foods is expected to generate 12.38 times more return on investment than TRADEGATE. However, United Natural is 12.38 times more volatile than TRADEGATE. It trades about 0.1 of its potential returns per unit of risk. TRADEGATE is currently generating about 0.0 per unit of risk. If you would invest 2,655 in United Natural Foods on October 16, 2024 and sell it today you would earn a total of 96.00 from holding United Natural Foods or generate 3.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Natural Foods vs. TRADEGATE
Performance |
| Timeline |
| United Natural Foods |
| TRADEGATE |
United Natural and TRADEGATE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Natural and TRADEGATE
The main advantage of trading using opposite United Natural and TRADEGATE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Natural position performs unexpectedly, TRADEGATE 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 TRADEGATE will offset losses from the drop in TRADEGATE's long position.| United Natural vs. Entravision Communications | United Natural vs. Highlight Communications AG | United Natural vs. CAREER EDUCATION | United Natural vs. INTERSHOP Communications Aktiengesellschaft |
| TRADEGATE vs. TRAINLINE PLC LS | TRADEGATE vs. Suntory Beverage Food | TRADEGATE vs. Tsingtao Brewery | TRADEGATE vs. BROADWIND ENRGY |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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