Correlation Between EBRO FOODS and SLIGRO FOOD

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

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

Diversification Opportunities for EBRO FOODS and SLIGRO FOOD

0.88

Correlation Coefficient

EBRO FOODS  SLIGRO FOOD

Very poor diversification

The 3 months correlation between EBRO and SLIGRO is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding EBRO FOODS and SLIGRO FOOD GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SLIGRO FOOD GROUP and EBRO FOODS 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 EBRO FOODS are associated (or correlated) with SLIGRO FOOD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SLIGRO FOOD GROUP has no effect on the direction of EBRO FOODS i.e., EBRO FOODS and SLIGRO FOOD go up and down completely randomly.

Pair Corralation between EBRO FOODS and SLIGRO FOOD

Assuming the 90 days trading horizon EBRO FOODS is expected to generate 3.45 times less return on investment than SLIGRO FOOD. But when comparing it to its historical volatility, EBRO FOODS is 2.73 times less risky than SLIGRO FOOD. It trades about 0.11 of its potential returns per unit of risk. SLIGRO FOOD GROUP is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  1,083  in SLIGRO FOOD GROUP on March 24, 2025 and sell it today you would earn a total of  263.00  from holding SLIGRO FOOD GROUP or generate 24.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

EBRO FOODS  vs.  SLIGRO FOOD GROUP

EBRO FOODS

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in EBRO FOODS are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, EBRO FOODS may actually be approaching a critical reversion point that can send shares even higher in July 2025.

SLIGRO FOOD GROUP

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SLIGRO FOOD GROUP are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, SLIGRO FOOD unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EBRO FOODS and SLIGRO FOOD

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

The idea behind EBRO FOODS and SLIGRO FOOD GROUP 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.