Correlation Between BJs Wholesale and Barfresh Food
Can any of the company-specific risk be diversified away by investing in both BJs Wholesale and Barfresh Food 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 BJs Wholesale and Barfresh Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Wholesale Club and Barfresh Food Group, you can compare the effects of market volatilities on BJs Wholesale and Barfresh Food 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 BJs Wholesale with a short position of Barfresh Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Wholesale and Barfresh Food.
Diversification Opportunities for BJs Wholesale and Barfresh Food
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BJs and Barfresh is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding BJs Wholesale Club and Barfresh Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barfresh Food Group and BJs Wholesale 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 BJs Wholesale Club are associated (or correlated) with Barfresh Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barfresh Food Group has no effect on the direction of BJs Wholesale i.e., BJs Wholesale and Barfresh Food go up and down completely randomly.
Pair Corralation between BJs Wholesale and Barfresh Food
Allowing for the 90-day total investment horizon BJs Wholesale is expected to generate 5.76 times less return on investment than Barfresh Food. But when comparing it to its historical volatility, BJs Wholesale Club is 5.02 times less risky than Barfresh Food. It trades about 0.05 of its potential returns per unit of risk. Barfresh Food Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 150.00 in Barfresh Food Group on August 27, 2024 and sell it today you would earn a total of 135.00 from holding Barfresh Food Group or generate 90.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.78% |
| Values | Daily Returns |
BJs Wholesale Club vs. Barfresh Food Group
Performance |
| Timeline |
| BJs Wholesale Club |
| Barfresh Food Group |
BJs Wholesale and Barfresh Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Wholesale and Barfresh Food
The main advantage of trading using opposite BJs Wholesale and Barfresh Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Wholesale position performs unexpectedly, Barfresh Food 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 Barfresh Food will offset losses from the drop in Barfresh Food's long position.| BJs Wholesale vs. Innovative Food Hldg | BJs Wholesale vs. Calavo Growers | BJs Wholesale vs. The Chefs Warehouse | BJs Wholesale vs. AMCON Distributing |
| Barfresh Food vs. Flow Beverage Corp | Barfresh Food vs. Fbec Worldwide | Barfresh Food vs. Hill Street Beverage | Barfresh Food vs. Eq Energy Drink |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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