Correlation Between SOUTHERN and Grocery Outlet
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By analyzing existing cross correlation between SOUTHERN CALIF EDISON and Grocery Outlet Holding, you can compare the effects of market volatilities on SOUTHERN and Grocery Outlet 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 SOUTHERN with a short position of Grocery Outlet. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOUTHERN and Grocery Outlet.
Diversification Opportunities for SOUTHERN and Grocery Outlet
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SOUTHERN and Grocery is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding SOUTHERN CALIF EDISON and Grocery Outlet Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grocery Outlet Holding and SOUTHERN 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 SOUTHERN CALIF EDISON are associated (or correlated) with Grocery Outlet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grocery Outlet Holding has no effect on the direction of SOUTHERN i.e., SOUTHERN and Grocery Outlet go up and down completely randomly.
Pair Corralation between SOUTHERN and Grocery Outlet
Assuming the 90 days trading horizon SOUTHERN CALIF EDISON is expected to generate 23.32 times more return on investment than Grocery Outlet. However, SOUTHERN is 23.32 times more volatile than Grocery Outlet Holding. It trades about 0.05 of its potential returns per unit of risk. Grocery Outlet Holding is currently generating about -0.03 per unit of risk. If you would invest 9,929 in SOUTHERN CALIF EDISON on September 4, 2024 and sell it today you would earn a total of 388.00 from holding SOUTHERN CALIF EDISON or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 75.87% |
| Values | Daily Returns |
SOUTHERN CALIF EDISON vs. Grocery Outlet Holding
Performance |
| Timeline |
| SOUTHERN CALIF EDISON |
| Grocery Outlet Holding |
SOUTHERN and Grocery Outlet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOUTHERN and Grocery Outlet
The main advantage of trading using opposite SOUTHERN and Grocery Outlet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOUTHERN position performs unexpectedly, Grocery Outlet 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 Grocery Outlet will offset losses from the drop in Grocery Outlet's long position.| SOUTHERN vs. ArcelorMittal SA ADR | SOUTHERN vs. Emerson Radio | SOUTHERN vs. Mangazeya Mining | SOUTHERN vs. Summit Materials |
| Grocery Outlet vs. Natural Grocers by | Grocery Outlet vs. Village Super Market | Grocery Outlet vs. Ingles Markets Incorporated | Grocery Outlet 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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