Correlation Between Sysco and SUPERVALU INC

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

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

Diversification Opportunities for Sysco and SUPERVALU INC

0.0

Correlation Coefficient

Sysco  SUPERVALU INC

Pay attention - limited upside

The 3 months correlation between Sysco and SUPERVALU is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sysco and SUPERVALU INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUPERVALU INC and Sysco 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 Sysco 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 Sysco i.e., Sysco and SUPERVALU INC go up and down completely randomly.

Pair Corralation between Sysco and SUPERVALU INC

If you would invest  7,197  in Sysco on January 21, 2024 and sell it today you would earn a total of  476.00  from holding Sysco or generate 6.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Sysco  vs.  SUPERVALU INC

Sysco

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sysco are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Sysco is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

SUPERVALU INC

Risk-Adjusted Performance

0 of 100

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.

Pair Trading with Sysco and SUPERVALU INC

The main advantage of trading using opposite Sysco and SUPERVALU INC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sysco 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 Sysco 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.

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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.