Correlation Between Grocery Outlet and 26442UAP9

Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and 26442UAP9 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 26442UAP9 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 DUK 4 01 APR 52, you can compare the effects of market volatilities on Grocery Outlet and 26442UAP9 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 26442UAP9. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and 26442UAP9.

Diversification Opportunities for Grocery Outlet and 26442UAP9

0.0

Correlation Coefficient

Grocery Outlet  26442UAP9

Pay attention - limited upside

The 3 months correlation between Grocery and 26442UAP9 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and DUK 4 01 APR 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 26442UAP9 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 26442UAP9. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 26442UAP9 has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and 26442UAP9 go up and down completely randomly.

Pair Corralation between Grocery Outlet and 26442UAP9

Allowing for the 90-day total investment horizon Grocery Outlet Holding is expected to under-perform the 26442UAP9. In addition to that, Grocery Outlet is 4.56 times more volatile than DUK 4 01 APR 52. It trades about -0.04 of its total potential returns per unit of risk. DUK 4 01 APR 52 is currently generating about 0.08 per unit of volatility. If you would invest  7,620  in DUK 4 01 APR 52 on December 24, 2024 and sell it today you would earn a total of  216.00  from holding DUK 4 01 APR 52 or generate 2.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	55.74%
Values	Daily Returns

Grocery Outlet Holding  vs.  DUK 4 01 APR 52

Grocery Outlet Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Grocery Outlet Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

26442UAP9

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in DUK 4 01 APR 52 are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 26442UAP9 is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Grocery Outlet and 26442UAP9

The main advantage of trading using opposite Grocery Outlet and 26442UAP9 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grocery Outlet position performs unexpectedly, 26442UAP9 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 26442UAP9 will offset losses from the drop in 26442UAP9's long position.

The idea behind Grocery Outlet Holding and DUK 4 01 APR 52 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.

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 Stocks Directory module to find actively traded stocks across global markets.