Correlation Between Campbell Soup and PlantFuel Life
Can any of the company-specific risk be diversified away by investing in both Campbell Soup and PlantFuel Life 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 PlantFuel Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Campbell Soup and PlantFuel Life, you can compare the effects of market volatilities on Campbell Soup and PlantFuel Life 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 PlantFuel Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Campbell Soup and PlantFuel Life.
Diversification Opportunities for Campbell Soup and PlantFuel Life
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Campbell and PlantFuel is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Campbell Soup and PlantFuel Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PlantFuel Life 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 PlantFuel Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PlantFuel Life has no effect on the direction of Campbell Soup i.e., Campbell Soup and PlantFuel Life go up and down completely randomly.
Pair Corralation between Campbell Soup and PlantFuel Life
Considering the 90-day investment horizon Campbell Soup is expected to under-perform the PlantFuel Life. But the stock apears to be less risky and, when comparing its historical volatility, Campbell Soup is 20.8 times less risky than PlantFuel Life. The stock trades about -0.02 of its potential returns per unit of risk. The PlantFuel Life is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 79.00 in PlantFuel Life on September 3, 2024 and sell it today you would lose (78.00) from holding PlantFuel Life or give up 98.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Campbell Soup vs. PlantFuel Life
Performance |
| Timeline |
| Campbell Soup |
| PlantFuel Life |
Campbell Soup and PlantFuel Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Campbell Soup and PlantFuel Life
The main advantage of trading using opposite Campbell Soup and PlantFuel Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Campbell Soup position performs unexpectedly, PlantFuel Life 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 PlantFuel Life will offset losses from the drop in PlantFuel Life's long position.| Campbell Soup vs. General Mills | Campbell Soup vs. Hormel Foods | Campbell Soup vs. Kellanova | Campbell Soup vs. Lamb Weston Holdings |
| PlantFuel Life vs. ConAgra Foods | PlantFuel Life vs. Campbell Soup | PlantFuel Life vs. Hormel Foods | PlantFuel Life vs. Flowers 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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