Correlation Between Edible Garden and Clean Seas
Can any of the company-specific risk be diversified away by investing in both Edible Garden and Clean Seas 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 Edible Garden and Clean Seas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edible Garden AG and Clean Seas Seafood, you can compare the effects of market volatilities on Edible Garden and Clean Seas 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 Edible Garden with a short position of Clean Seas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edible Garden and Clean Seas.
Diversification Opportunities for Edible Garden and Clean Seas
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Edible and Clean is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Edible Garden AG and Clean Seas Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Seas Seafood and Edible Garden 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 Edible Garden AG are associated (or correlated) with Clean Seas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Seas Seafood has no effect on the direction of Edible Garden i.e., Edible Garden and Clean Seas go up and down completely randomly.
Pair Corralation between Edible Garden and Clean Seas
If you would invest 14.00 in Clean Seas Seafood on August 25, 2024 and sell it today you would earn a total of 0.00 from holding Clean Seas Seafood or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Edible Garden AG vs. Clean Seas Seafood
Performance |
| Timeline |
| Edible Garden AG |
| Clean Seas Seafood |
Edible Garden and Clean Seas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edible Garden and Clean Seas
The main advantage of trading using opposite Edible Garden and Clean Seas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edible Garden position performs unexpectedly, Clean Seas 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 Clean Seas will offset losses from the drop in Clean Seas' long position.| Edible Garden vs. Golden Agri Resources | Edible Garden vs. Vital Farms | Edible Garden vs. Local Bounti Corp | Edible Garden vs. Fresh Del Monte |
| Clean Seas vs. Avi Ltd ADR | Clean Seas vs. Altavoz Entertainment | Clean Seas vs. The a2 Milk | Clean Seas vs. Aryzta AG PK |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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