Correlation Between ConAgra Foods and Hormel Foods
Can any of the company-specific risk be diversified away by investing in both ConAgra Foods and Hormel 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 ConAgra Foods and Hormel Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ConAgra Foods and Hormel Foods, you can compare the effects of market volatilities on ConAgra Foods and Hormel 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 ConAgra Foods with a short position of Hormel Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of ConAgra Foods and Hormel Foods.
Diversification Opportunities for ConAgra Foods and Hormel Foods
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ConAgra and Hormel is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding ConAgra Foods and Hormel Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hormel Foods and ConAgra 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 ConAgra Foods are associated (or correlated) with Hormel Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hormel Foods has no effect on the direction of ConAgra Foods i.e., ConAgra Foods and Hormel Foods go up and down completely randomly.
Pair Corralation between ConAgra Foods and Hormel Foods
Considering the 90-day investment horizon ConAgra Foods is expected to under-perform the Hormel Foods. But the stock apears to be less risky and, when comparing its historical volatility, ConAgra Foods is 1.19 times less risky than Hormel Foods. The stock trades about -0.03 of its potential returns per unit of risk. The Hormel Foods is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 3,677 in Hormel Foods on November 1, 2024 and sell it today you would lose (634.00) from holding Hormel Foods or give up 17.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ConAgra Foods vs. Hormel Foods
Performance |
| Timeline |
| ConAgra Foods |
| Hormel Foods |
ConAgra Foods and Hormel Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ConAgra Foods and Hormel Foods
The main advantage of trading using opposite ConAgra Foods and Hormel Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ConAgra Foods position performs unexpectedly, Hormel 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 Hormel Foods will offset losses from the drop in Hormel Foods' long position.| ConAgra Foods vs. Kellanova | ConAgra Foods vs. General Mills | ConAgra Foods vs. JM Smucker | ConAgra Foods vs. Hormel Foods |
| Hormel Foods vs. Campbell Soup | Hormel Foods vs. General Mills | Hormel Foods vs. Kellanova | Hormel Foods vs. Lamb Weston Holdings |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |