Correlation Between Spectrum Brands and SUPERVALU INC

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Can any of the company-specific risk be diversified away by investing in both Spectrum Brands and SUPERVALU INC 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 Spectrum Brands and SUPERVALU INC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spectrum Brands Holdings and SUPERVALU INC, you can compare the effects of market volatilities on Spectrum Brands and SUPERVALU INC 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 Spectrum Brands with a short position of SUPERVALU INC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spectrum Brands and SUPERVALU INC.

Diversification Opportunities for Spectrum Brands and SUPERVALU INC

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Spectrum and SUPERVALU is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Spectrum Brands Holdings and SUPERVALU INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUPERVALU INC and Spectrum Brands 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 Spectrum Brands Holdings are associated (or correlated) with SUPERVALU INC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUPERVALU INC has no effect on the direction of Spectrum Brands i.e., Spectrum Brands and SUPERVALU INC go up and down completely randomly.

Pair Corralation between Spectrum Brands and SUPERVALU INC

If you would invest  8,048  in Spectrum Brands Holdings on December 29, 2023 and sell it today you would earn a total of  843.00  from holding Spectrum Brands Holdings or generate 10.47% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Spectrum Brands Holdings  vs.  SUPERVALU INC

 Performance 
       Timeline  
Spectrum Brands Holdings 

Risk-Adjusted Performance

9 of 100

 
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OK
Compared to the overall equity markets, risk-adjusted returns on investments in Spectrum Brands Holdings are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting basic indicators, Spectrum Brands may actually be approaching a critical reversion point that can send shares even higher in April 2024.
SUPERVALU INC 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days SUPERVALU INC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, SUPERVALU INC is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Spectrum Brands and SUPERVALU INC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Spectrum Brands and SUPERVALU INC

The main advantage of trading using opposite Spectrum Brands and SUPERVALU INC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spectrum Brands position performs unexpectedly, SUPERVALU INC 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 SUPERVALU INC will offset losses from the drop in SUPERVALU INC's long position.
The idea behind Spectrum Brands Holdings and SUPERVALU INC 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.
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.

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