Correlation Between Campbell Soup and Edible Garden
Can any of the company-specific risk be diversified away by investing in both Campbell Soup and Edible Garden 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 Campbell Soup and Edible Garden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Campbell Soup and Edible Garden AG, you can compare the effects of market volatilities on Campbell Soup and Edible Garden 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 Campbell Soup with a short position of Edible Garden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Campbell Soup and Edible Garden.
Diversification Opportunities for Campbell Soup and Edible Garden
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Campbell and Edible is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Campbell Soup and Edible Garden AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edible Garden AG and Campbell Soup 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 Campbell Soup are associated (or correlated) with Edible Garden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edible Garden AG has no effect on the direction of Campbell Soup i.e., Campbell Soup and Edible Garden go up and down completely randomly.
Pair Corralation between Campbell Soup and Edible Garden
Considering the 90-day investment horizon Campbell Soup is expected to generate 0.14 times more return on investment than Edible Garden. However, Campbell Soup is 7.22 times less risky than Edible Garden. It trades about -0.01 of its potential returns per unit of risk. Edible Garden AG is currently generating about -0.1 per unit of risk. If you would invest 5,266 in Campbell Soup on August 30, 2024 and sell it today you would lose (659.00) from holding Campbell Soup or give up 12.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Campbell Soup vs. Edible Garden AG
Performance |
| Timeline |
| Campbell Soup |
| Edible Garden AG |
Campbell Soup and Edible Garden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Campbell Soup and Edible Garden
The main advantage of trading using opposite Campbell Soup and Edible Garden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Campbell Soup position performs unexpectedly, Edible Garden 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 Edible Garden will offset losses from the drop in Edible Garden's long position.| Campbell Soup vs. General Mills | Campbell Soup vs. Hormel Foods | Campbell Soup vs. Kellanova | Campbell Soup vs. Lamb Weston Holdings |
| Edible Garden vs. Golden Agri Resources | Edible Garden vs. Vital Farms | Edible Garden vs. Local Bounti Corp | Edible Garden vs. Fresh Del Monte |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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