Correlation Between Codere Online and Sweetgreen

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

By analyzing existing cross correlation between Codere Online Luxembourg and Sweetgreen, you can compare the effects of market volatilities on Codere Online and Sweetgreen 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 Codere Online with a short position of Sweetgreen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Codere Online and Sweetgreen.

Diversification Opportunities for Codere Online and Sweetgreen

-0.17

Correlation Coefficient

Codere Online  Sweetgreen

Good diversification

The 3 months correlation between Codere and Sweetgreen is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Codere Online Luxembourg and Sweetgreen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sweetgreen and Codere Online 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 Codere Online Luxembourg are associated (or correlated) with Sweetgreen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sweetgreen has no effect on the direction of Codere Online i.e., Codere Online and Sweetgreen go up and down completely randomly.

Pair Corralation between Codere Online and Sweetgreen

Assuming the 90 days horizon Codere Online Luxembourg is expected to generate 1.29 times more return on investment than Sweetgreen. However, Codere Online is 1.29 times more volatile than Sweetgreen. It trades about -0.16 of its potential returns per unit of risk. Sweetgreen is currently generating about -0.25 per unit of risk. If you would invest  92.00  in Codere Online Luxembourg on September 27, 2024 and sell it today you would lose (16.99) from holding Codere Online Luxembourg or give up 18.47% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	90.91%
Values	Daily Returns

Codere Online Luxembourg  vs.  Sweetgreen

Codere Online Luxembourg

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Codere Online Luxembourg has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Sweetgreen

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sweetgreen has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Sweetgreen is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Codere Online and Sweetgreen

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

The idea behind Codere Online Luxembourg and Sweetgreen 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.