Correlation Between Victory Supermarket and Shufersal
Can any of the company-specific risk be diversified away by investing in both Victory Supermarket and Shufersal 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 Victory Supermarket and Shufersal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Victory Supermarket Chain and Shufersal, you can compare the effects of market volatilities on Victory Supermarket and Shufersal 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 Victory Supermarket with a short position of Shufersal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Supermarket and Shufersal.
Diversification Opportunities for Victory Supermarket and Shufersal
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Victory and Shufersal is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Victory Supermarket Chain and Shufersal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shufersal and Victory Supermarket 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 Victory Supermarket Chain are associated (or correlated) with Shufersal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shufersal has no effect on the direction of Victory Supermarket i.e., Victory Supermarket and Shufersal go up and down completely randomly.
Pair Corralation between Victory Supermarket and Shufersal
Assuming the 90 days trading horizon Victory Supermarket Chain is expected to generate 1.13 times more return on investment than Shufersal. However, Victory Supermarket is 1.13 times more volatile than Shufersal. It trades about 0.18 of its potential returns per unit of risk. Shufersal is currently generating about 0.16 per unit of risk. If you would invest 487,000 in Victory Supermarket Chain on November 2, 2024 and sell it today you would earn a total of 75,300 from holding Victory Supermarket Chain or generate 15.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Victory Supermarket Chain vs. Shufersal
Performance |
| Timeline |
| Victory Supermarket Chain |
| Shufersal |
Victory Supermarket and Shufersal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Victory Supermarket and Shufersal
The main advantage of trading using opposite Victory Supermarket and Shufersal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory Supermarket position performs unexpectedly, Shufersal 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 Shufersal will offset losses from the drop in Shufersal's long position.| Victory Supermarket vs. Shufersal | Victory Supermarket vs. Rami Levi | Victory Supermarket vs. Tiv Taam | Victory Supermarket vs. M Yochananof and |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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