Correlation Between MSAD Insurance and Kroger
Can any of the company-specific risk be diversified away by investing in both MSAD Insurance and Kroger 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 MSAD Insurance and Kroger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MSAD Insurance Group and Kroger Company, you can compare the effects of market volatilities on MSAD Insurance and Kroger 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 MSAD Insurance with a short position of Kroger. Check out your portfolio center. Please also check ongoing floating volatility patterns of MSAD Insurance and Kroger.
Diversification Opportunities for MSAD Insurance and Kroger
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between MSAD and Kroger is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding MSAD Insurance Group and Kroger Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kroger Company and MSAD Insurance 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 MSAD Insurance Group are associated (or correlated) with Kroger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kroger Company has no effect on the direction of MSAD Insurance i.e., MSAD Insurance and Kroger go up and down completely randomly.
Pair Corralation between MSAD Insurance and Kroger
Assuming the 90 days horizon MSAD Insurance Group is expected to generate 1.39 times more return on investment than Kroger. However, MSAD Insurance is 1.39 times more volatile than Kroger Company. It trades about 0.03 of its potential returns per unit of risk. Kroger Company is currently generating about -0.09 per unit of risk. If you would invest 1,783 in MSAD Insurance Group on January 29, 2024 and sell it today you would earn a total of 12.00 from holding MSAD Insurance Group or generate 0.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
MSAD Insurance Group vs. Kroger Company
Performance |
Timeline |
MSAD Insurance Group |
Kroger Company |
MSAD Insurance and Kroger Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MSAD Insurance and Kroger
The main advantage of trading using opposite MSAD Insurance and Kroger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MSAD Insurance position performs unexpectedly, Kroger 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 Kroger will offset losses from the drop in Kroger's long position.MSAD Insurance vs. Osisko Metals Incorporated | MSAD Insurance vs. Mineral Res | MSAD Insurance vs. IGO Limited | MSAD Insurance vs. Qubec Nickel Corp |
Kroger vs. Grocery Outlet Holding | Kroger vs. Sprouts Farmers Market | Kroger vs. Sendas Distribuidora SA | Kroger vs. Weis Markets |
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.
Other Complementary Tools
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
Content Syndication Quickly integrate customizable finance content to your own investment portal |