Correlation Between CONAGRA FOODS and CVW CLEANTECH
Can any of the company-specific risk be diversified away by investing in both CONAGRA FOODS and CVW CLEANTECH 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 CVW CLEANTECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CONAGRA FOODS and CVW CLEANTECH INC, you can compare the effects of market volatilities on CONAGRA FOODS and CVW CLEANTECH 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 CVW CLEANTECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of CONAGRA FOODS and CVW CLEANTECH.
Diversification Opportunities for CONAGRA FOODS and CVW CLEANTECH
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between CONAGRA and CVW is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding CONAGRA FOODS and CVW CLEANTECH INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVW CLEANTECH INC 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 CVW CLEANTECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVW CLEANTECH INC has no effect on the direction of CONAGRA FOODS i.e., CONAGRA FOODS and CVW CLEANTECH go up and down completely randomly.
Pair Corralation between CONAGRA FOODS and CVW CLEANTECH
Assuming the 90 days trading horizon CONAGRA FOODS is expected to under-perform the CVW CLEANTECH. But the stock apears to be less risky and, when comparing its historical volatility, CONAGRA FOODS is 1.25 times less risky than CVW CLEANTECH. The stock trades about -0.09 of its potential returns per unit of risk. The CVW CLEANTECH INC is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 53.00 in CVW CLEANTECH INC on August 27, 2024 and sell it today you would earn a total of 5.00 from holding CVW CLEANTECH INC or generate 9.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CONAGRA FOODS vs. CVW CLEANTECH INC
Performance |
| Timeline |
| CONAGRA FOODS |
| CVW CLEANTECH INC |
CONAGRA FOODS and CVW CLEANTECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CONAGRA FOODS and CVW CLEANTECH
The main advantage of trading using opposite CONAGRA FOODS and CVW CLEANTECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CONAGRA FOODS position performs unexpectedly, CVW CLEANTECH 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 CVW CLEANTECH will offset losses from the drop in CVW CLEANTECH's long position.| CONAGRA FOODS vs. MARKET VECTR RETAIL | CONAGRA FOODS vs. Wayside Technology Group | CONAGRA FOODS vs. Casio Computer CoLtd | CONAGRA FOODS vs. AECOM TECHNOLOGY |
| CVW CLEANTECH vs. Southwest Airlines Co | CVW CLEANTECH vs. American Public Education | CVW CLEANTECH vs. Aegean Airlines SA | CVW CLEANTECH vs. Laureate Education |
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.
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