Correlation Between Ocado Group and Wm Morrison
Can any of the company-specific risk be diversified away by investing in both Ocado Group and Wm Morrison 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 Ocado Group and Wm Morrison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ocado Group PLC and Wm Morrison Supermarkets, you can compare the effects of market volatilities on Ocado Group and Wm Morrison 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 Ocado Group with a short position of Wm Morrison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ocado Group and Wm Morrison.
Diversification Opportunities for Ocado Group and Wm Morrison
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ocado and MRWSF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ocado Group PLC and Wm Morrison Supermarkets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wm Morrison Supermarkets and Ocado Group 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 Ocado Group PLC are associated (or correlated) with Wm Morrison. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wm Morrison Supermarkets has no effect on the direction of Ocado Group i.e., Ocado Group and Wm Morrison go up and down completely randomly.
Pair Corralation between Ocado Group and Wm Morrison
If you would invest (100.00) in Wm Morrison Supermarkets on January 20, 2024 and sell it today you would earn a total of 100.00 from holding Wm Morrison Supermarkets 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 |
Ocado Group PLC vs. Wm Morrison Supermarkets
Performance |
| Timeline |
| Ocado Group PLC |
| Wm Morrison Supermarkets |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ocado Group and Wm Morrison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ocado Group and Wm Morrison
The main advantage of trading using opposite Ocado Group and Wm Morrison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ocado Group position performs unexpectedly, Wm Morrison 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 Wm Morrison will offset losses from the drop in Wm Morrison's long position.| Ocado Group vs. Natural Grocers by | Ocado Group vs. Grocery Outlet Holding | Ocado Group vs. Village Super Market | Ocado Group vs. Ingles Markets Incorporated |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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