Correlation Analysis Between Home Depot and Alcoa

This module allows you to analyze existing cross correlation between The Home Depot and Alcoa Corporation. You can compare the effects of market volatilities on Home Depot and Alcoa 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 Home Depot with a short position of Alcoa. See also your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and Alcoa.
Horizon     30 Days    Login   to change
Symbolsvs
Compare Efficiency

Comparative Performance

Home Depot  
17

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in The Home Depot are ranked lower than 17 (%) of all global equities and portfolios over the last 30 days. In spite of rather sluggish fundamental drivers, Home Depot exhibited solid returns over the last few months and may actually be approaching a breakup point.
Alcoa  
0

Risk-Adjusted Performance

Over the last 30 days Alcoa Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in May 2019. The current disturbance may also be a sign of long term up-swing for the company investors.

Home Depot and Alcoa Volatility Contrast

 Predicted Return Density 
      Returns 

The Home Depot Inc  vs.  Alcoa Corp.

 Performance (%) 
      Timeline 

Pair Volatility

Allowing for the 30-days total investment horizon, The Home Depot is expected to generate 0.36 times more return on investment than Alcoa. However, The Home Depot is 2.74 times less risky than Alcoa. It trades about 0.26 of its potential returns per unit of risk. Alcoa Corporation is currently generating about -0.08 per unit of risk. If you would invest  18,830  in The Home Depot on March 26, 2019 and sell it today you would earn a total of  1,842  from holding The Home Depot or generate 9.78% return on investment over 30 days.

Pair Corralation between Home Depot and Alcoa

0.03
Time Period2 Months [change]
DirectionPositive 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Diversification Opportunities for Home Depot and Alcoa

The Home Depot Inc diversification synergy

Significant diversification

Overlapping area represents the amount of risk that can be diversified away by holding The Home Depot Inc and Alcoa Corp. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Alcoa and Home Depot 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 The Home Depot are associated (or correlated) with Alcoa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alcoa has no effect on the direction of Home Depot i.e. Home Depot and Alcoa go up and down completely randomly.
See also your portfolio center. Please also try Equity Valuation module to check real value of public entities based on technical and fundamental data.


 
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