Correlation Between DELHAIZE and Kuya Silver

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

By analyzing existing cross correlation between DELHAIZE GROUP SA and Kuya Silver, you can compare the effects of market volatilities on DELHAIZE and Kuya Silver 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 DELHAIZE with a short position of Kuya Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of DELHAIZE and Kuya Silver.

Diversification Opportunities for DELHAIZE and Kuya Silver

-0.26

Correlation Coefficient

DELHAIZE  Kuya Silver

Very good diversification

The 3 months correlation between DELHAIZE and Kuya is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding DELHAIZE GROUP SA and Kuya Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuya Silver and DELHAIZE 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 DELHAIZE GROUP SA are associated (or correlated) with Kuya Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuya Silver has no effect on the direction of DELHAIZE i.e., DELHAIZE and Kuya Silver go up and down completely randomly.

Pair Corralation between DELHAIZE and Kuya Silver

Assuming the 90 days trading horizon DELHAIZE is expected to generate 50.33 times less return on investment than Kuya Silver. But when comparing it to its historical volatility, DELHAIZE GROUP SA is 5.35 times less risky than Kuya Silver. It trades about 0.01 of its potential returns per unit of risk. Kuya Silver is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  18.00  in Kuya Silver on December 24, 2024 and sell it today you would earn a total of  6.00  from holding Kuya Silver or generate 33.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	51.67%
Values	Daily Returns

DELHAIZE GROUP SA  vs.  Kuya Silver

DELHAIZE GROUP SA

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in DELHAIZE GROUP SA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, DELHAIZE is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Kuya Silver

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kuya Silver are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Kuya Silver reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with DELHAIZE and Kuya Silver

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

The idea behind DELHAIZE GROUP SA and Kuya Silver 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.