Correlation Between Beyond Meat and Herbalife Nutrition
Can any of the company-specific risk be diversified away by investing in both Beyond Meat and Herbalife Nutrition 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 Beyond Meat and Herbalife Nutrition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beyond Meat and Herbalife Nutrition, you can compare the effects of market volatilities on Beyond Meat and Herbalife Nutrition 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 Beyond Meat with a short position of Herbalife Nutrition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beyond Meat and Herbalife Nutrition.
Diversification Opportunities for Beyond Meat and Herbalife Nutrition
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Beyond and Herbalife is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Beyond Meat and Herbalife Nutrition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Herbalife Nutrition and Beyond Meat 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 Beyond Meat are associated (or correlated) with Herbalife Nutrition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Herbalife Nutrition has no effect on the direction of Beyond Meat i.e., Beyond Meat and Herbalife Nutrition go up and down completely randomly.
Pair Corralation between Beyond Meat and Herbalife Nutrition
Given the investment horizon of 90 days Beyond Meat is expected to under-perform the Herbalife Nutrition. In addition to that, Beyond Meat is 1.05 times more volatile than Herbalife Nutrition. It trades about -0.06 of its total potential returns per unit of risk. Herbalife Nutrition is currently generating about -0.01 per unit of volatility. If you would invest 821.00 in Herbalife Nutrition on September 4, 2024 and sell it today you would lose (41.00) from holding Herbalife Nutrition or give up 4.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beyond Meat vs. Herbalife Nutrition
Performance |
| Timeline |
| Beyond Meat |
| Herbalife Nutrition |
Beyond Meat and Herbalife Nutrition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beyond Meat and Herbalife Nutrition
The main advantage of trading using opposite Beyond Meat and Herbalife Nutrition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beyond Meat position performs unexpectedly, Herbalife Nutrition 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 Herbalife Nutrition will offset losses from the drop in Herbalife Nutrition's long position.| Beyond Meat vs. Kraft Heinz Co | Beyond Meat vs. Hormel Foods | Beyond Meat vs. Kellanova | Beyond Meat vs. General Mills |
| Herbalife Nutrition vs. Colgate Palmolive | Herbalife Nutrition vs. Estee Lauder Companies | Herbalife Nutrition vs. Procter Gamble | Herbalife Nutrition vs. United Guardian |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Stocks Directory Find actively traded stocks across global markets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |