Correlation Between Village Super and Sligro Food
Can any of the company-specific risk be diversified away by investing in both Village Super and Sligro Food 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 Village Super and Sligro Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Village Super Market and Sligro Food Group, you can compare the effects of market volatilities on Village Super and Sligro Food 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 Village Super with a short position of Sligro Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Village Super and Sligro Food.
Diversification Opportunities for Village Super and Sligro Food
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Village and Sligro is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Village Super Market and Sligro Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sligro Food Group and Village Super 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 Village Super Market are associated (or correlated) with Sligro Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sligro Food Group has no effect on the direction of Village Super i.e., Village Super and Sligro Food go up and down completely randomly.
Pair Corralation between Village Super and Sligro Food
Assuming the 90 days horizon Village Super Market is expected to generate 1.25 times more return on investment than Sligro Food. However, Village Super is 1.25 times more volatile than Sligro Food Group. It trades about 0.15 of its potential returns per unit of risk. Sligro Food Group is currently generating about -0.21 per unit of risk. If you would invest 2,896 in Village Super Market on August 30, 2024 and sell it today you would earn a total of 311.00 from holding Village Super Market or generate 10.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Village Super Market vs. Sligro Food Group
Performance |
| Timeline |
| Village Super Market |
| Sligro Food Group |
Village Super and Sligro Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Village Super and Sligro Food
The main advantage of trading using opposite Village Super and Sligro Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Village Super position performs unexpectedly, Sligro Food 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 Sligro Food will offset losses from the drop in Sligro Food's long position.| Village Super vs. Ingles Markets Incorporated | Village Super vs. Natural Grocers by | Village Super vs. Grocery Outlet Holding | Village Super vs. Weis Markets |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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