Correlation Between Walgreens Boots and OFFICE DEPOT
Can any of the company-specific risk be diversified away by investing in both Walgreens Boots and OFFICE DEPOT 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 Walgreens Boots and OFFICE DEPOT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walgreens Boots Alliance and OFFICE DEPOT, you can compare the effects of market volatilities on Walgreens Boots and OFFICE DEPOT 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 Walgreens Boots with a short position of OFFICE DEPOT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walgreens Boots and OFFICE DEPOT.
Diversification Opportunities for Walgreens Boots and OFFICE DEPOT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Walgreens and OFFICE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Walgreens Boots Alliance and OFFICE DEPOT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFFICE DEPOT and Walgreens Boots 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 Walgreens Boots Alliance are associated (or correlated) with OFFICE DEPOT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFFICE DEPOT has no effect on the direction of Walgreens Boots i.e., Walgreens Boots and OFFICE DEPOT go up and down completely randomly.
Pair Corralation between Walgreens Boots and OFFICE DEPOT
If you would invest 834.00 in Walgreens Boots Alliance on September 4, 2024 and sell it today you would earn a total of 30.00 from holding Walgreens Boots Alliance or generate 3.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Walgreens Boots Alliance vs. OFFICE DEPOT
Performance |
| Timeline |
| Walgreens Boots Alliance |
| OFFICE DEPOT |
Walgreens Boots and OFFICE DEPOT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walgreens Boots and OFFICE DEPOT
The main advantage of trading using opposite Walgreens Boots and OFFICE DEPOT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walgreens Boots position performs unexpectedly, OFFICE DEPOT 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 OFFICE DEPOT will offset losses from the drop in OFFICE DEPOT's long position.| Walgreens Boots vs. Alibaba Health Information | Walgreens Boots vs. Beijing Tong Ren | Walgreens Boots vs. PetMed Express | Walgreens Boots vs. Oriola Oyj |
| OFFICE DEPOT vs. TOTAL GABON | OFFICE DEPOT vs. Walgreens Boots Alliance | OFFICE DEPOT vs. Peak Resources Limited |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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