Correlation Between Grocery Outlet and NESNVX

Can any of the company-specific risk be diversified away by investing in both Grocery Outlet and NESNVX 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 NESNVX 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 NESNVX 35 24 SEP 25, you can compare the effects of market volatilities on Grocery Outlet and NESNVX 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 NESNVX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grocery Outlet and NESNVX.

Diversification Opportunities for Grocery Outlet and NESNVX

-0.31

Correlation Coefficient

Grocery Outlet  NESNVX

Very good diversification

The 3 months correlation between Grocery and NESNVX is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Grocery Outlet Holding and NESNVX 35 24 SEP 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NESNVX 35 24 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 NESNVX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NESNVX 35 24 has no effect on the direction of Grocery Outlet i.e., Grocery Outlet and NESNVX go up and down completely randomly.

Pair Corralation between Grocery Outlet and NESNVX

Allowing for the 90-day total investment horizon Grocery Outlet Holding is expected to under-perform the NESNVX. In addition to that, Grocery Outlet is 5.83 times more volatile than NESNVX 35 24 SEP 25. It trades about -0.04 of its total potential returns per unit of risk. NESNVX 35 24 SEP 25 is currently generating about -0.02 per unit of volatility. If you would invest  9,810  in NESNVX 35 24 SEP 25 on October 14, 2024 and sell it today you would lose (134.00) from holding NESNVX 35 24 SEP 25 or give up 1.37% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	42.74%
Values	Daily Returns

Grocery Outlet Holding  vs.  NESNVX 35 24 SEP 25

Grocery Outlet Holding

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Grocery Outlet Holding are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Grocery Outlet may actually be approaching a critical reversion point that can send shares even higher in February 2025.

NESNVX 35 24

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NESNVX 35 24 SEP 25 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for NESNVX 35 24 SEP 25 investors.

Pair Trading with Grocery Outlet and NESNVX

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

The idea behind Grocery Outlet Holding and NESNVX 35 24 SEP 25 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.