Correlation Between KRAFT and Albertsons Companies
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By analyzing existing cross correlation between KRAFT HEINZ FOODS and Albertsons Companies, you can compare the effects of market volatilities on KRAFT and Albertsons Companies 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 KRAFT with a short position of Albertsons Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of KRAFT and Albertsons Companies.
Diversification Opportunities for KRAFT and Albertsons Companies
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KRAFT and Albertsons is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding KRAFT HEINZ FOODS and Albertsons Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Albertsons Companies and KRAFT 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 KRAFT HEINZ FOODS are associated (or correlated) with Albertsons Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Albertsons Companies has no effect on the direction of KRAFT i.e., KRAFT and Albertsons Companies go up and down completely randomly.
Pair Corralation between KRAFT and Albertsons Companies
Assuming the 90 days trading horizon KRAFT HEINZ FOODS is expected to under-perform the Albertsons Companies. In addition to that, KRAFT is 1.25 times more volatile than Albertsons Companies. It trades about -0.14 of its total potential returns per unit of risk. Albertsons Companies is currently generating about 0.36 per unit of volatility. If you would invest 1,810 in Albertsons Companies on September 1, 2024 and sell it today you would earn a total of 175.00 from holding Albertsons Companies or generate 9.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KRAFT HEINZ FOODS vs. Albertsons Companies
Performance |
| Timeline |
| KRAFT HEINZ FOODS |
| Albertsons Companies |
KRAFT and Albertsons Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KRAFT and Albertsons Companies
The main advantage of trading using opposite KRAFT and Albertsons Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KRAFT position performs unexpectedly, Albertsons Companies 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 Albertsons Companies will offset losses from the drop in Albertsons Companies' long position.The idea behind KRAFT HEINZ FOODS and Albertsons Companies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Albertsons Companies vs. Ingles Markets Incorporated | Albertsons Companies vs. Sendas Distribuidora SA | Albertsons Companies vs. Grocery Outlet Holding | Albertsons Companies vs. Ocado Group plc |
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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