Correlation Between Bon Natural and Seneca Foods
Can any of the company-specific risk be diversified away by investing in both Bon Natural and Seneca Foods 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 Bon Natural and Seneca Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bon Natural Life and Seneca Foods Corp, you can compare the effects of market volatilities on Bon Natural and Seneca Foods 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 Bon Natural with a short position of Seneca Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bon Natural and Seneca Foods.
Diversification Opportunities for Bon Natural and Seneca Foods
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bon and Seneca is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Bon Natural Life and Seneca Foods Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seneca Foods Corp and Bon Natural 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 Bon Natural Life are associated (or correlated) with Seneca Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seneca Foods Corp has no effect on the direction of Bon Natural i.e., Bon Natural and Seneca Foods go up and down completely randomly.
Pair Corralation between Bon Natural and Seneca Foods
Considering the 90-day investment horizon Bon Natural Life is expected to under-perform the Seneca Foods. In addition to that, Bon Natural is 16.7 times more volatile than Seneca Foods Corp. It trades about -0.24 of its total potential returns per unit of risk. Seneca Foods Corp is currently generating about -0.06 per unit of volatility. If you would invest 8,549 in Seneca Foods Corp on January 12, 2025 and sell it today you would lose (218.00) from holding Seneca Foods Corp or give up 2.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bon Natural Life vs. Seneca Foods Corp
Performance |
| Timeline |
| Bon Natural Life |
| Seneca Foods Corp |
Bon Natural and Seneca Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bon Natural and Seneca Foods
The main advantage of trading using opposite Bon Natural and Seneca Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bon Natural position performs unexpectedly, Seneca Foods 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 Seneca Foods will offset losses from the drop in Seneca Foods' long position.| Bon Natural vs. Grand Havana | Bon Natural vs. Central Garden Pet | Bon Natural vs. Natures Sunshine Products | Bon Natural vs. Central Garden Pet |
| Seneca Foods vs. Central Garden Pet | Seneca Foods vs. Central Garden Pet | Seneca Foods vs. Natures Sunshine Products | Seneca Foods vs. Associated British Foods |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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