Correlation Between Sligro Food and AFC Ajax

Can any of the company-specific risk be diversified away by investing in both Sligro Food and AFC Ajax 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 AFC Ajax 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 AFC Ajax NV, you can compare the effects of market volatilities on Sligro Food and AFC Ajax 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 AFC Ajax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sligro Food and AFC Ajax.

Diversification Opportunities for Sligro Food and AFC Ajax

0.65

Correlation Coefficient

Sligro Food  AFC Ajax

Poor diversification

The 3 months correlation between Sligro and AFC is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Sligro Food Group and AFC Ajax NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AFC Ajax NV 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 AFC Ajax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AFC Ajax NV has no effect on the direction of Sligro Food i.e., Sligro Food and AFC Ajax go up and down completely randomly.

Pair Corralation between Sligro Food and AFC Ajax

Assuming the 90 days trading horizon Sligro Food Group is expected to under-perform the AFC Ajax. In addition to that, Sligro Food is 4.2 times more volatile than AFC Ajax NV. It trades about -0.05 of its total potential returns per unit of risk. AFC Ajax NV is currently generating about -0.04 per unit of volatility. If you would invest  980.00  in AFC Ajax NV on May 19, 2025 and sell it today you would lose (18.00) from holding AFC Ajax NV or give up 1.84% of portfolio value over 90 days.

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

Sligro Food Group  vs.  AFC Ajax NV

Sligro Food Group

Risk-Adjusted Performance

Weakest

Over the last 90 days Sligro Food Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

AFC Ajax NV

Risk-Adjusted Performance

Weakest

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

Pair Trading with Sligro Food and AFC Ajax

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

The idea behind Sligro Food Group and AFC Ajax NV 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.