Correlation Between Bell Food and Young Cos
Can any of the company-specific risk be diversified away by investing in both Bell Food and Young Cos 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 Bell Food and Young Cos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bell Food Group and Young Cos Brewery, you can compare the effects of market volatilities on Bell Food and Young Cos 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 Bell Food with a short position of Young Cos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bell Food and Young Cos.
Diversification Opportunities for Bell Food and Young Cos
Good diversification
The 3 months correlation between Bell and Young is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Bell Food Group and Young Cos Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Young Cos Brewery and Bell 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 Bell Food Group are associated (or correlated) with Young Cos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Young Cos Brewery has no effect on the direction of Bell Food i.e., Bell Food and Young Cos go up and down completely randomly.
Pair Corralation between Bell Food and Young Cos
Assuming the 90 days trading horizon Bell Food Group is expected to generate 0.58 times more return on investment than Young Cos. However, Bell Food Group is 1.74 times less risky than Young Cos. It trades about 0.09 of its potential returns per unit of risk. Young Cos Brewery is currently generating about -0.14 per unit of risk. If you would invest 26,300 in Bell Food Group on October 16, 2024 and sell it today you would earn a total of 450.00 from holding Bell Food Group or generate 1.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Bell Food Group vs. Young Cos Brewery
Performance |
| Timeline |
| Bell Food Group |
| Young Cos Brewery |
Bell Food and Young Cos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bell Food and Young Cos
The main advantage of trading using opposite Bell Food and Young Cos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bell Food position performs unexpectedly, Young Cos 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 Young Cos will offset losses from the drop in Young Cos' long position.| Bell Food vs. Nordic Semiconductor ASA | Bell Food vs. BE Semiconductor Industries | Bell Food vs. Broadridge Financial Solutions | Bell Food vs. JB Hunt Transport |
| Young Cos vs. Jupiter Fund Management | Young Cos vs. Litigation Capital Management | Young Cos vs. Liontrust Asset Management | Young Cos vs. Chrysalis Investments |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |