Correlation Between Bridgford Foods and Hf Foods
Can any of the company-specific risk be diversified away by investing in both Bridgford Foods and Hf 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 Bridgford Foods and Hf Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bridgford Foods and Hf Foods Group, you can compare the effects of market volatilities on Bridgford Foods and Hf 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 Bridgford Foods with a short position of Hf Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bridgford Foods and Hf Foods.
Diversification Opportunities for Bridgford Foods and Hf Foods
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bridgford and HFFG is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Bridgford Foods and Hf Foods Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hf Foods Group 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 Hf Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hf Foods Group has no effect on the direction of Bridgford Foods i.e., Bridgford Foods and Hf Foods go up and down completely randomly.
Pair Corralation between Bridgford Foods and Hf Foods
Given the investment horizon of 90 days Bridgford Foods is expected to generate 0.75 times more return on investment than Hf Foods. However, Bridgford Foods is 1.34 times less risky than Hf Foods. It trades about -0.02 of its potential returns per unit of risk. Hf Foods Group is currently generating about -0.24 per unit of risk. If you would invest 1,041 in Bridgford Foods on November 18, 2024 and sell it today you would lose (10.00) from holding Bridgford Foods or give up 0.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bridgford Foods vs. Hf Foods Group
Performance |
| Timeline |
| Bridgford Foods |
| Hf Foods Group |
Bridgford Foods and Hf Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bridgford Foods and Hf Foods
The main advantage of trading using opposite Bridgford Foods and Hf Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bridgford Foods position performs unexpectedly, Hf 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 Hf Foods will offset losses from the drop in Hf Foods' long position.| Bridgford Foods vs. Seneca Foods Corp | Bridgford Foods vs. J J Snack | Bridgford Foods vs. Central Garden Pet | Bridgford Foods vs. Central Garden Pet |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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