Correlation Between Chicago Atlantic and Village Super

Can any of the company-specific risk be diversified away by investing in both Chicago Atlantic and Village Super 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 Chicago Atlantic and Village Super into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Chicago Atlantic BDC, and Village Super Market, you can compare the effects of market volatilities on Chicago Atlantic and Village Super 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 Chicago Atlantic with a short position of Village Super. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chicago Atlantic and Village Super.

Diversification Opportunities for Chicago Atlantic and Village Super

-0.05

Correlation Coefficient

Chicago Atlantic  Village Super

Good diversification

The 3 months correlation between Chicago and Village is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Chicago Atlantic BDC, and Village Super Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Village Super Market and Chicago Atlantic 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 Chicago Atlantic BDC, are associated (or correlated) with Village Super. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Village Super Market has no effect on the direction of Chicago Atlantic i.e., Chicago Atlantic and Village Super go up and down completely randomly.

Pair Corralation between Chicago Atlantic and Village Super

Given the investment horizon of 90 days Chicago Atlantic BDC, is expected to generate 1.16 times more return on investment than Village Super. However, Chicago Atlantic is 1.16 times more volatile than Village Super Market. It trades about 0.06 of its potential returns per unit of risk. Village Super Market is currently generating about 0.05 per unit of risk. If you would invest  737.00  in Chicago Atlantic BDC, on October 4, 2024 and sell it today you would earn a total of  519.00  from holding Chicago Atlantic BDC, or generate 70.42% return on investment over 90 days.

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

Chicago Atlantic BDC,  vs.  Village Super Market

Chicago Atlantic BDC,

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Chicago Atlantic BDC, are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Chicago Atlantic is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Village Super Market

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Village Super Market are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical and fundamental indicators, Village Super is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Chicago Atlantic and Village Super

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

The idea behind Chicago Atlantic BDC, and Village Super Market 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.