Correlation Between Campbell Soup and Farmmi
Can any of the company-specific risk be diversified away by investing in both Campbell Soup and Farmmi 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 Farmmi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Campbell Soup and Farmmi Inc, you can compare the effects of market volatilities on Campbell Soup and Farmmi 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 Farmmi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Campbell Soup and Farmmi.
Diversification Opportunities for Campbell Soup and Farmmi
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Campbell and Farmmi is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Campbell Soup and Farmmi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Farmmi Inc 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 Farmmi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Farmmi Inc has no effect on the direction of Campbell Soup i.e., Campbell Soup and Farmmi go up and down completely randomly.
Pair Corralation between Campbell Soup and Farmmi
Considering the 90-day investment horizon Campbell Soup is expected to generate 0.16 times more return on investment than Farmmi. However, Campbell Soup is 6.29 times less risky than Farmmi. It trades about 0.03 of its potential returns per unit of risk. Farmmi Inc is currently generating about -0.05 per unit of risk. If you would invest 4,402 in Campbell Soup on August 29, 2024 and sell it today you would earn a total of 205.00 from holding Campbell Soup or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Campbell Soup vs. Farmmi Inc
Performance |
| Timeline |
| Campbell Soup |
| Farmmi Inc |
Campbell Soup and Farmmi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Campbell Soup and Farmmi
The main advantage of trading using opposite Campbell Soup and Farmmi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Campbell Soup position performs unexpectedly, Farmmi 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 Farmmi will offset losses from the drop in Farmmi's long position.| Campbell Soup vs. General Mills | Campbell Soup vs. Hormel Foods | Campbell Soup vs. Kellanova | Campbell Soup 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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