Correlation Between Grocery Outlet and Asbury Automotive
Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and Asbury Automotive 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 Grocery Outlet and Asbury Automotive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grocery Outlet Holding and Asbury Automotive Group, you can compare the effects of market volatilities on Grocery Outlet and Asbury Automotive 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 Grocery Outlet with a short position of Asbury Automotive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and Asbury Automotive.
Diversification Opportunities for Grocery Outlet and Asbury Automotive
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Grocery and Asbury is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and Asbury Automotive Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asbury Automotive and Grocery Outlet 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 Grocery Outlet Holding are associated (or correlated) with Asbury Automotive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asbury Automotive has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and Asbury Automotive go up and down completely randomly.
Pair Corralation between Grocery Outlet and Asbury Automotive
Allowing for the 90-day total investment horizon Grocery Outlet Holding is expected to under-perform the Asbury Automotive. In addition to that, Grocery Outlet is 2.1 times more volatile than Asbury Automotive Group. It trades about -0.16 of its total potential returns per unit of risk. Asbury Automotive Group is currently generating about -0.02 per unit of volatility. If you would invest 26,537 in Asbury Automotive Group on December 4, 2024 and sell it today you would lose (1,002) from holding Asbury Automotive Group or give up 3.78% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Grocery Outlet Holding vs. Asbury Automotive Group
Performance |
Timeline |
Grocery Outlet Holding |
Asbury Automotive |
Grocery Outlet and Asbury Automotive Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Grocery Outlet and Asbury Automotive
The main advantage of trading using opposite Grocery Outlet and Asbury Automotive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grocery Outlet position performs unexpectedly, Asbury Automotive 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 Asbury Automotive will offset losses from the drop in Asbury Automotive's long position.Grocery Outlet vs. Natural Grocers by | Grocery Outlet vs. Village Super Market | Grocery Outlet vs. Ingles Markets Incorporated | Grocery Outlet vs. Ocado Group plc |
Asbury Automotive vs. Sonic Automotive | Asbury Automotive vs. Lithia Motors | Asbury Automotive vs. AutoNation | Asbury Automotive vs. Penske Automotive Group |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |