Correlation Between Zegona Communications and Sligro Food
Can any of the company-specific risk be diversified away by investing in both Zegona Communications 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 Zegona Communications and Sligro Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zegona Communications Plc and Sligro Food Group, you can compare the effects of market volatilities on Zegona Communications 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 Zegona Communications with a short position of Sligro Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zegona Communications and Sligro Food.
Diversification Opportunities for Zegona Communications and Sligro Food
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zegona and Sligro is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Zegona Communications Plc 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 Zegona Communications 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 Zegona Communications Plc 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 Zegona Communications i.e., Zegona Communications and Sligro Food go up and down completely randomly.
Pair Corralation between Zegona Communications and Sligro Food
Assuming the 90 days trading horizon Zegona Communications Plc is expected to generate 13.81 times more return on investment than Sligro Food. However, Zegona Communications is 13.81 times more volatile than Sligro Food Group. It trades about 0.05 of its potential returns per unit of risk. Sligro Food Group is currently generating about -0.06 per unit of risk. If you would invest 7,650 in Zegona Communications Plc on November 9, 2024 and sell it today you would earn a total of 43,850 from holding Zegona Communications Plc or generate 573.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.25% |
| Values | Daily Returns |
Zegona Communications Plc vs. Sligro Food Group
Performance |
| Timeline |
| Zegona Communications Plc |
| Sligro Food Group |
Zegona Communications and Sligro Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zegona Communications and Sligro Food
The main advantage of trading using opposite Zegona Communications and Sligro Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zegona Communications 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.| Zegona Communications vs. Liberty Media Corp | Zegona Communications vs. Monster Beverage Corp | Zegona Communications vs. AcadeMedia AB | Zegona Communications vs. Seche Environnement SA |
| Sligro Food vs. Liechtensteinische Landesbank AG | Sligro Food vs. Berner Kantonalbank AG | Sligro Food vs. Vienna Insurance Group | Sligro Food vs. Moneta Money Bank |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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