Correlation Between Weis Markets and Koninklijke Ahold
Can any of the company-specific risk be diversified away by investing in both Weis Markets and Koninklijke Ahold 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 Weis Markets and Koninklijke Ahold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weis Markets and Koninklijke Ahold Delhaize, you can compare the effects of market volatilities on Weis Markets and Koninklijke Ahold 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 Weis Markets with a short position of Koninklijke Ahold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weis Markets and Koninklijke Ahold.
Diversification Opportunities for Weis Markets and Koninklijke Ahold
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Weis and Koninklijke is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Weis Markets and Koninklijke Ahold Delhaize in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koninklijke Ahold and Weis Markets 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 Weis Markets are associated (or correlated) with Koninklijke Ahold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koninklijke Ahold has no effect on the direction of Weis Markets i.e., Weis Markets and Koninklijke Ahold go up and down completely randomly.
Pair Corralation between Weis Markets and Koninklijke Ahold
Considering the 90-day investment horizon Weis Markets is expected to generate 1.87 times more return on investment than Koninklijke Ahold. However, Weis Markets is 1.87 times more volatile than Koninklijke Ahold Delhaize. It trades about 0.25 of its potential returns per unit of risk. Koninklijke Ahold Delhaize is currently generating about 0.1 per unit of risk. If you would invest 6,353 in Weis Markets on August 31, 2024 and sell it today you would earn a total of 926.00 from holding Weis Markets or generate 14.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weis Markets vs. Koninklijke Ahold Delhaize
Performance |
| Timeline |
| Weis Markets |
| Koninklijke Ahold |
Weis Markets and Koninklijke Ahold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weis Markets and Koninklijke Ahold
The main advantage of trading using opposite Weis Markets and Koninklijke Ahold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weis Markets position performs unexpectedly, Koninklijke Ahold 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 Koninklijke Ahold will offset losses from the drop in Koninklijke Ahold's long position.| Weis Markets vs. Natural Grocers by | Weis Markets vs. Village Super Market | Weis Markets vs. Ingles Markets Incorporated | Weis Markets vs. Ocado Group plc |
| Koninklijke Ahold vs. Weis Markets | Koninklijke Ahold vs. Albertsons Companies | Koninklijke Ahold vs. Dingdong ADR | Koninklijke Ahold vs. Natural Grocers by |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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