Correlation Between Target and SUPERVALU INC

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

Diversification Opportunities for Target and SUPERVALU INC

0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between Target and SUPERVALU INC

If you would invest  15,199  in Target on December 29, 2023 and sell it today you would earn a total of  2,268  from holding Target or generate 14.92% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Target  vs.  SUPERVALU INC

 Performance 
       Timeline  
Target 

Risk-Adjusted Performance

13 of 100

 
Low
 
High
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Target are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile technical and fundamental indicators, Target unveiled solid returns over the last few months and may actually be approaching a breakup point.
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.

Target and SUPERVALU INC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Target and SUPERVALU INC

The main advantage of trading using opposite Target and SUPERVALU INC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Target 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 Target 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

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