Correlation Between Allego and 4 Less

Can any of the company-specific risk be diversified away by investing in both Allego and 4 Less 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 Allego and 4 Less into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Allego Inc and 4 Less Group, you can compare the effects of market volatilities on Allego and 4 Less 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 Allego with a short position of 4 Less. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allego and 4 Less.

Diversification Opportunities for Allego and 4 Less

-0.2

Correlation Coefficient

Allego  4 Less

Good diversification

The 3 months correlation between Allego and FLES is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Allego Inc and 4 Less Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 4 Less Group and Allego 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 Allego Inc are associated (or correlated) with 4 Less. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 4 Less Group has no effect on the direction of Allego i.e., Allego and 4 Less go up and down completely randomly.

Pair Corralation between Allego and 4 Less

Given the investment horizon of 90 days Allego Inc is expected to generate 0.5 times more return on investment than 4 Less. However, Allego Inc is 2.01 times less risky than 4 Less. It trades about 0.02 of its potential returns per unit of risk. 4 Less Group is currently generating about 0.01 per unit of risk. If you would invest  456.00  in Allego Inc on October 23, 2024 and sell it today you would lose (265.00) from holding Allego Inc or give up 58.11% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	88.13%
Values	Daily Returns

Allego Inc  vs.  4 Less Group

Allego Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Allego Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's essential indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

4 Less Group

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in 4 Less Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent technical and fundamental indicators, 4 Less unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Allego and 4 Less

The main advantage of trading using opposite Allego and 4 Less positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allego position performs unexpectedly, 4 Less 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 4 Less will offset losses from the drop in 4 Less' long position.

The idea behind Allego Inc and 4 Less Group 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.