Correlation Between Albertsons Companies and Super League

Can any of the company-specific risk be diversified away by investing in both Albertsons Companies and Super League 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 Albertsons Companies and Super League into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Albertsons Companies and Super League Enterprise, you can compare the effects of market volatilities on Albertsons Companies and Super League 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 Albertsons Companies with a short position of Super League. Check out your portfolio center. Please also check ongoing floating volatility patterns of Albertsons Companies and Super League.

Diversification Opportunities for Albertsons Companies and Super League

-0.53

Correlation Coefficient

Albertsons Companies  Super League

Excellent diversification

The 3 months correlation between Albertsons and Super is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Albertsons Companies and Super League Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Super League Enterprise and Albertsons Companies 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 Albertsons Companies are associated (or correlated) with Super League. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Super League Enterprise has no effect on the direction of Albertsons Companies i.e., Albertsons Companies and Super League go up and down completely randomly.

Pair Corralation between Albertsons Companies and Super League

Considering the 90-day investment horizon Albertsons Companies is expected to generate 3.34 times less return on investment than Super League. But when comparing it to its historical volatility, Albertsons Companies is 5.14 times less risky than Super League. It trades about 0.01 of its potential returns per unit of risk. Super League Enterprise is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  81.00  in Super League Enterprise on September 29, 2024 and sell it today you would lose (17.00) from holding Super League Enterprise or give up 20.99% of portfolio value over 90 days.

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

Albertsons Companies  vs.  Super League Enterprise

Albertsons Companies

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Albertsons Companies are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating fundamental indicators, Albertsons Companies may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Super League Enterprise

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Super League Enterprise are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak essential indicators, Super League exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Albertsons Companies and Super League

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

The idea behind Albertsons Companies and Super League Enterprise 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.