Correlation Between Campbell Soup and Limoneira
Can any of the company-specific risk be diversified away by investing in both Campbell Soup and Limoneira 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 Limoneira into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Campbell Soup and Limoneira Co, you can compare the effects of market volatilities on Campbell Soup and Limoneira 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 Limoneira. Check out your portfolio center. Please also check ongoing floating volatility patterns of Campbell Soup and Limoneira.
Diversification Opportunities for Campbell Soup and Limoneira
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Campbell and Limoneira is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Campbell Soup and Limoneira Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Limoneira 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 Limoneira. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Limoneira has no effect on the direction of Campbell Soup i.e., Campbell Soup and Limoneira go up and down completely randomly.
Pair Corralation between Campbell Soup and Limoneira
Considering the 90-day investment horizon Campbell Soup is expected to generate 7.46 times less return on investment than Limoneira. But when comparing it to its historical volatility, Campbell Soup is 1.6 times less risky than Limoneira. It trades about 0.02 of its potential returns per unit of risk. Limoneira Co is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,795 in Limoneira Co on August 28, 2024 and sell it today you would earn a total of 938.00 from holding Limoneira Co or generate 52.26% 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. Limoneira Co
Performance |
| Timeline |
| Campbell Soup |
| Limoneira |
Campbell Soup and Limoneira Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Campbell Soup and Limoneira
The main advantage of trading using opposite Campbell Soup and Limoneira positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Campbell Soup position performs unexpectedly, Limoneira 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 Limoneira will offset losses from the drop in Limoneira's long position.| Campbell Soup vs. Bellring Brands LLC | Campbell Soup vs. Ingredion Incorporated | Campbell Soup vs. Nomad Foods | Campbell Soup vs. Simply Good Foods |
| Limoneira vs. Dole PLC | Limoneira vs. Alico Inc | Limoneira vs. Adecoagro SA | Limoneira vs. Cal Maine Foods |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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