Correlation Between Benson Hill, and Scotts Miracle
Can any of the company-specific risk be diversified away by investing in both Benson Hill, and Scotts Miracle 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 Benson Hill, and Scotts Miracle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Benson Hill, Common and Scotts Miracle Gro, you can compare the effects of market volatilities on Benson Hill, and Scotts Miracle 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 Benson Hill, with a short position of Scotts Miracle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Benson Hill, and Scotts Miracle.
Diversification Opportunities for Benson Hill, and Scotts Miracle
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Benson and Scotts is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Benson Hill, Common and Scotts Miracle Gro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scotts Miracle Gro and Benson Hill, 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 Benson Hill, Common are associated (or correlated) with Scotts Miracle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scotts Miracle Gro has no effect on the direction of Benson Hill, i.e., Benson Hill, and Scotts Miracle go up and down completely randomly.
Pair Corralation between Benson Hill, and Scotts Miracle
Given the investment horizon of 90 days Benson Hill, Common is expected to under-perform the Scotts Miracle. But the stock apears to be less risky and, when comparing its historical volatility, Benson Hill, Common is 1.16 times less risky than Scotts Miracle. The stock trades about -0.69 of its potential returns per unit of risk. The Scotts Miracle Gro is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 8,752 in Scotts Miracle Gro on August 27, 2024 and sell it today you would lose (579.00) from holding Scotts Miracle Gro or give up 6.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Benson Hill, Common vs. Scotts Miracle Gro
Performance |
| Timeline |
| Benson Hill, Common |
| Scotts Miracle Gro |
Benson Hill, and Scotts Miracle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Benson Hill, and Scotts Miracle
The main advantage of trading using opposite Benson Hill, and Scotts Miracle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Benson Hill, position performs unexpectedly, Scotts Miracle 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 Scotts Miracle will offset losses from the drop in Scotts Miracle's long position.| Benson Hill, vs. Intrepid Potash | Benson Hill, vs. Bioceres Crop Solutions | Benson Hill, vs. E I du | Benson Hill, vs. FMC Corporation |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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