Correlation Between Grocery Outlet and Condor Resources

Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and Condor Resources 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 Condor Resources 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 Condor Resources, you can compare the effects of market volatilities on Grocery Outlet and Condor Resources 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 Condor Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and Condor Resources.

Diversification Opportunities for Grocery Outlet and Condor Resources

-0.11

Correlation Coefficient

Grocery Outlet  Condor Resources

Good diversification

The 3 months correlation between Grocery and Condor is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and Condor Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Condor Resources 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 Condor Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Condor Resources has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and Condor Resources go up and down completely randomly.

Pair Corralation between Grocery Outlet and Condor Resources

Allowing for the 90-day total investment horizon Grocery Outlet Holding is expected to generate 0.78 times more return on investment than Condor Resources. However, Grocery Outlet Holding is 1.28 times less risky than Condor Resources. It trades about 0.23 of its potential returns per unit of risk. Condor Resources is currently generating about -0.02 per unit of risk. If you would invest  1,661  in Grocery Outlet Holding on August 30, 2024 and sell it today you would earn a total of  464.00  from holding Grocery Outlet Holding or generate 27.93% return on investment over 90 days.

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

Grocery Outlet Holding  vs.  Condor Resources

Grocery Outlet Holding

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Grocery Outlet Holding are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, Grocery Outlet displayed solid returns over the last few months and may actually be approaching a breakup point.

Condor Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Condor Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's forward indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Grocery Outlet and Condor Resources

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

The idea behind Grocery Outlet Holding and Condor Resources 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.