Correlation Between Performance Food and DEXUS
Can any of the company-specific risk be diversified away by investing in both Performance Food and DEXUS 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 Performance Food and DEXUS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Performance Food Group and DEXUS, you can compare the effects of market volatilities on Performance Food and DEXUS 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 Performance Food with a short position of DEXUS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performance Food and DEXUS.
Diversification Opportunities for Performance Food and DEXUS
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Performance and DEXUS is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Performance Food Group and DEXUS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DEXUS and Performance Food 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 Performance Food Group are associated (or correlated) with DEXUS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DEXUS has no effect on the direction of Performance Food i.e., Performance Food and DEXUS go up and down completely randomly.
Pair Corralation between Performance Food and DEXUS
Assuming the 90 days trading horizon Performance Food Group is expected to under-perform the DEXUS. But the stock apears to be less risky and, when comparing its historical volatility, Performance Food Group is 1.07 times less risky than DEXUS. The stock trades about -0.16 of its potential returns per unit of risk. The DEXUS is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 397.00 in DEXUS on December 24, 2024 and sell it today you would earn a total of 21.00 from holding DEXUS or generate 5.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Performance Food Group vs. DEXUS
Performance |
Timeline |
Performance Food |
DEXUS |
Performance Food and DEXUS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Performance Food and DEXUS
The main advantage of trading using opposite Performance Food and DEXUS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performance Food position performs unexpectedly, DEXUS 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 DEXUS will offset losses from the drop in DEXUS's long position.Performance Food vs. Moneysupermarket Group PLC | Performance Food vs. United Natural Foods | Performance Food vs. MOLSON RS BEVERAGE | Performance Food vs. Monster Beverage Corp |
DEXUS vs. UNIQA INSURANCE GR | DEXUS vs. SENECA FOODS A | DEXUS vs. CREDIT AGRICOLE | DEXUS vs. Cincinnati Financial Corp |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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