Correlation Between Grocery Outlet and ENELIM

Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and ENELIM 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 ENELIM 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 ENELIM 2875 12 JUL 41, you can compare the effects of market volatilities on Grocery Outlet and ENELIM 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 ENELIM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and ENELIM.

Diversification Opportunities for Grocery Outlet and ENELIM

0.03

Correlation Coefficient

Grocery Outlet  ENELIM

Significant diversification

The 3 months correlation between Grocery and ENELIM is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and ENELIM 2875 12 JUL 41 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENELIM 2875 12 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 ENELIM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENELIM 2875 12 has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and ENELIM go up and down completely randomly.

Pair Corralation between Grocery Outlet and ENELIM

Allowing for the 90-day total investment horizon Grocery Outlet Holding is expected to under-perform the ENELIM. In addition to that, Grocery Outlet is 1.92 times more volatile than ENELIM 2875 12 JUL 41. It trades about -0.04 of its total potential returns per unit of risk. ENELIM 2875 12 JUL 41 is currently generating about 0.03 per unit of volatility. If you would invest  6,320  in ENELIM 2875 12 JUL 41 on September 29, 2024 and sell it today you would earn a total of  346.00  from holding ENELIM 2875 12 JUL 41 or generate 5.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	43.55%
Values	Daily Returns

Grocery Outlet Holding  vs.  ENELIM 2875 12 JUL 41

Grocery Outlet Holding

Risk-Adjusted Performance

0 of 100

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 uncertain 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.

ENELIM 2875 12

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ENELIM 2875 12 JUL 41 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for ENELIM 2875 12 JUL 41 investors.

Pair Trading with Grocery Outlet and ENELIM

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

The idea behind Grocery Outlet Holding and ENELIM 2875 12 JUL 41 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.