Correlation Between Almacenes Xito and Kroger
Can any of the company-specific risk be diversified away by investing in both Almacenes Xito and Kroger 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 Almacenes Xito and Kroger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Almacenes xito SA and Kroger Company, you can compare the effects of market volatilities on Almacenes Xito and Kroger 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 Almacenes Xito with a short position of Kroger. Check out your portfolio center. Please also check ongoing floating volatility patterns of Almacenes Xito and Kroger.
Diversification Opportunities for Almacenes Xito and Kroger
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Almacenes and Kroger is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Almacenes xito SA and Kroger Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kroger Company and Almacenes Xito 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 Almacenes xito SA are associated (or correlated) with Kroger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kroger Company has no effect on the direction of Almacenes Xito i.e., Almacenes Xito and Kroger go up and down completely randomly.
Pair Corralation between Almacenes Xito and Kroger
Given the investment horizon of 90 days Almacenes Xito is expected to generate 27.14 times less return on investment than Kroger. In addition to that, Almacenes Xito is 1.03 times more volatile than Kroger Company. It trades about 0.0 of its total potential returns per unit of risk. Kroger Company is currently generating about 0.05 per unit of volatility. If you would invest 6,009 in Kroger Company on September 24, 2024 and sell it today you would earn a total of 105.00 from holding Kroger Company or generate 1.75% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Almacenes xito SA vs. Kroger Company
Performance |
Timeline |
Almacenes xito SA |
Kroger Company |
Almacenes Xito and Kroger Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Almacenes Xito and Kroger
The main advantage of trading using opposite Almacenes Xito and Kroger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Almacenes Xito position performs unexpectedly, Kroger 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 Kroger will offset losses from the drop in Kroger's long position.Almacenes Xito vs. Transocean | Almacenes Xito vs. ICC Holdings | Almacenes Xito vs. Dave Busters Entertainment | Almacenes Xito vs. Assurant |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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