Correlation Between Slate Grocery and Wilmington Capital

Can any of the company-specific risk be diversified away by investing in both Slate Grocery and Wilmington Capital 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 Slate Grocery and Wilmington Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Slate Grocery REIT and Wilmington Capital Management, you can compare the effects of market volatilities on Slate Grocery and Wilmington Capital 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 Slate Grocery with a short position of Wilmington Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slate Grocery and Wilmington Capital.

Diversification Opportunities for Slate Grocery and Wilmington Capital

-0.32

Correlation Coefficient

Slate Grocery  Wilmington Capital

Very good diversification

The 3 months correlation between Slate and Wilmington is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Slate Grocery REIT and Wilmington Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmington Capital and Slate Grocery 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 Slate Grocery REIT are associated (or correlated) with Wilmington Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmington Capital has no effect on the direction of Slate Grocery i.e., Slate Grocery and Wilmington Capital go up and down completely randomly.

Pair Corralation between Slate Grocery and Wilmington Capital

Assuming the 90 days trading horizon Slate Grocery REIT is expected to generate 0.42 times more return on investment than Wilmington Capital. However, Slate Grocery REIT is 2.39 times less risky than Wilmington Capital. It trades about 0.36 of its potential returns per unit of risk. Wilmington Capital Management is currently generating about 0.02 per unit of risk. If you would invest  952.00  in Slate Grocery REIT on September 2, 2024 and sell it today you would earn a total of  118.00  from holding Slate Grocery REIT or generate 12.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Slate Grocery REIT  vs.  Wilmington Capital Management

Slate Grocery REIT

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Slate Grocery REIT are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, Slate Grocery unveiled solid returns over the last few months and may actually be approaching a breakup point.

Wilmington Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wilmington Capital Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Slate Grocery and Wilmington Capital

The main advantage of trading using opposite Slate Grocery and Wilmington Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Slate Grocery position performs unexpectedly, Wilmington Capital 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 Wilmington Capital will offset losses from the drop in Wilmington Capital's long position.

The idea behind Slate Grocery REIT and Wilmington Capital Management pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..