Correlation Between ConAgra Foods and Kerry Group
Can any of the company-specific risk be diversified away by investing in both ConAgra Foods and Kerry Group 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 Kerry Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ConAgra Foods and Kerry Group PLC, you can compare the effects of market volatilities on ConAgra Foods and Kerry Group 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 Kerry Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of ConAgra Foods and Kerry Group.
Diversification Opportunities for ConAgra Foods and Kerry Group
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ConAgra and Kerry is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding ConAgra Foods and Kerry Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kerry Group PLC 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 Kerry Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kerry Group PLC has no effect on the direction of ConAgra Foods i.e., ConAgra Foods and Kerry Group go up and down completely randomly.
Pair Corralation between ConAgra Foods and Kerry Group
Considering the 90-day investment horizon ConAgra Foods is expected to under-perform the Kerry Group. In addition to that, ConAgra Foods is 1.62 times more volatile than Kerry Group PLC. It trades about -0.06 of its total potential returns per unit of risk. Kerry Group PLC is currently generating about 0.18 per unit of volatility. If you would invest 10,140 in Kerry Group PLC on November 28, 2024 and sell it today you would earn a total of 456.00 from holding Kerry Group PLC or generate 4.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
ConAgra Foods vs. Kerry Group PLC
Performance |
| Timeline |
| ConAgra Foods |
| Kerry Group PLC |
ConAgra Foods and Kerry Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ConAgra Foods and Kerry Group
The main advantage of trading using opposite ConAgra Foods and Kerry Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ConAgra Foods position performs unexpectedly, Kerry Group 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 Kerry Group will offset losses from the drop in Kerry Group's long position.| ConAgra Foods vs. Kellanova | ConAgra Foods vs. General Mills | ConAgra Foods vs. JM Smucker | ConAgra Foods vs. Hormel Foods |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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