Correlation Between Bridgford Foods and Natures Sunshine
Can any of the company-specific risk be diversified away by investing in both Bridgford Foods and Natures Sunshine 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 Natures Sunshine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bridgford Foods and Natures Sunshine Products, you can compare the effects of market volatilities on Bridgford Foods and Natures Sunshine 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 Natures Sunshine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bridgford Foods and Natures Sunshine.
Diversification Opportunities for Bridgford Foods and Natures Sunshine
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bridgford and Natures is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Bridgford Foods and Natures Sunshine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natures Sunshine Products 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 Natures Sunshine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natures Sunshine Products has no effect on the direction of Bridgford Foods i.e., Bridgford Foods and Natures Sunshine go up and down completely randomly.
Pair Corralation between Bridgford Foods and Natures Sunshine
Given the investment horizon of 90 days Bridgford Foods is expected to under-perform the Natures Sunshine. In addition to that, Bridgford Foods is 1.14 times more volatile than Natures Sunshine Products. It trades about -0.01 of its total potential returns per unit of risk. Natures Sunshine Products is currently generating about 0.02 per unit of volatility. If you would invest 1,524 in Natures Sunshine Products on August 24, 2024 and sell it today you would earn a total of 43.00 from holding Natures Sunshine Products or generate 2.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.6% |
| Values | Daily Returns |
Bridgford Foods vs. Natures Sunshine Products
Performance |
| Timeline |
| Bridgford Foods |
| Natures Sunshine Products |
Bridgford Foods and Natures Sunshine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bridgford Foods and Natures Sunshine
The main advantage of trading using opposite Bridgford Foods and Natures Sunshine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bridgford Foods position performs unexpectedly, Natures Sunshine 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 Natures Sunshine will offset losses from the drop in Natures Sunshine's long position.| Bridgford Foods vs. Better Choice | Bridgford Foods vs. BioAdaptives | Bridgford Foods vs. Beyond Oil | Bridgford Foods vs. Bon Natural Life |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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