Correlation Between Missfresh and Ocado Group

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

By analyzing existing cross correlation between Missfresh Ltd ADR and Ocado Group plc, you can compare the effects of market volatilities on Missfresh and Ocado Group 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 Missfresh with a short position of Ocado Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Missfresh and Ocado Group.

Diversification Opportunities for Missfresh and Ocado Group

0.0

Correlation Coefficient

Missfresh  Ocado Group

Pay attention - limited upside

The 3 months correlation between Missfresh and Ocado is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Missfresh Ltd ADR and Ocado Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocado Group plc and Missfresh 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 Missfresh Ltd ADR are associated (or correlated) with Ocado Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocado Group plc has no effect on the direction of Missfresh i.e., Missfresh and Ocado Group go up and down completely randomly.

Pair Corralation between Missfresh and Ocado Group

If you would invest (100.00) in Missfresh Ltd ADR on December 20, 2024 and sell it today you would earn a total of  100.00  from holding Missfresh Ltd ADR or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Missfresh Ltd ADR  vs.  Ocado Group plc

Missfresh ADR

Risk-Adjusted Performance

Very Weak

Over the last 90 days Missfresh Ltd ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Missfresh is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Ocado Group plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ocado Group plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental indicators, Ocado Group is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Missfresh and Ocado Group

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

The idea behind Missfresh Ltd ADR and Ocado Group plc 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.