Correlation Between Bridgford Foods and Global Net
Can any of the company-specific risk be diversified away by investing in both Bridgford Foods and Global Net 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 Bridgford Foods and Global Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bridgford Foods and Global Net Lease, you can compare the effects of market volatilities on Bridgford Foods and Global Net 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 Bridgford Foods with a short position of Global Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bridgford Foods and Global Net.
Diversification Opportunities for Bridgford Foods and Global Net
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bridgford and Global is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Bridgford Foods and Global Net Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Net Lease and Bridgford Foods 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 Bridgford Foods are associated (or correlated) with Global Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Net Lease has no effect on the direction of Bridgford Foods i.e., Bridgford Foods and Global Net go up and down completely randomly.
Pair Corralation between Bridgford Foods and Global Net
Given the investment horizon of 90 days Bridgford Foods is expected to generate 2.36 times more return on investment than Global Net. However, Bridgford Foods is 2.36 times more volatile than Global Net Lease. It trades about 0.32 of its potential returns per unit of risk. Global Net Lease is currently generating about 0.01 per unit of risk. If you would invest 879.00 in Bridgford Foods on September 13, 2024 and sell it today you would earn a total of 149.00 from holding Bridgford Foods or generate 16.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bridgford Foods vs. Global Net Lease
Performance |
| Timeline |
| Bridgford Foods |
| Global Net Lease |
Bridgford Foods and Global Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bridgford Foods and Global Net
The main advantage of trading using opposite Bridgford Foods and Global Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bridgford Foods position performs unexpectedly, Global Net 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 Global Net will offset losses from the drop in Global Net's long position.| Bridgford Foods vs. J J Snack | Bridgford Foods vs. Central Garden Pet | Bridgford Foods vs. Central Garden Pet | Bridgford Foods vs. Lancaster Colony |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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