Correlation Between Sligro Food and RENEWI

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

By analyzing existing cross correlation between Sligro Food Group and RENEWI, you can compare the effects of market volatilities on Sligro Food and RENEWI 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 Sligro Food with a short position of RENEWI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sligro Food and RENEWI.

Diversification Opportunities for Sligro Food and RENEWI

-0.63

Correlation Coefficient

Sligro Food  RENEWI

Excellent diversification

The 3 months correlation between Sligro and RENEWI is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Sligro Food Group and RENEWI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RENEWI and Sligro Food 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 Sligro Food Group are associated (or correlated) with RENEWI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RENEWI has no effect on the direction of Sligro Food i.e., Sligro Food and RENEWI go up and down completely randomly.

Pair Corralation between Sligro Food and RENEWI

Assuming the 90 days trading horizon Sligro Food Group is expected to generate 0.15 times more return on investment than RENEWI. However, Sligro Food Group is 6.88 times less risky than RENEWI. It trades about 0.2 of its potential returns per unit of risk. RENEWI is currently generating about -0.13 per unit of risk. If you would invest  1,142  in Sligro Food Group on April 14, 2025 and sell it today you would earn a total of  288.00  from holding Sligro Food Group or generate 25.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	96.83%
Values	Daily Returns

Sligro Food Group  vs.  RENEWI

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 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Sligro Food sustained solid returns over the last few months and may actually be approaching a breakup point.

RENEWI

Risk-Adjusted Performance

Very Weak

Over the last 90 days RENEWI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's forward indicators remain comparatively stable which may send shares a bit higher in August 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Sligro Food and RENEWI

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

The idea behind Sligro Food Group and RENEWI 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.