Correlation Between Eat Well and Flow Capital
Can any of the company-specific risk be diversified away by investing in both Eat Well and Flow Capital 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 Eat Well and Flow Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eat Well Investment and Flow Capital Corp, you can compare the effects of market volatilities on Eat Well and Flow Capital 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 Eat Well with a short position of Flow Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eat Well and Flow Capital.
Diversification Opportunities for Eat Well and Flow Capital
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Eat and Flow is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Eat Well Investment and Flow Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flow Capital Corp and Eat Well 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 Eat Well Investment are associated (or correlated) with Flow Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flow Capital Corp has no effect on the direction of Eat Well i.e., Eat Well and Flow Capital go up and down completely randomly.
Pair Corralation between Eat Well and Flow Capital
Assuming the 90 days horizon Eat Well Investment is expected to generate 345.7 times more return on investment than Flow Capital. However, Eat Well is 345.7 times more volatile than Flow Capital Corp. It trades about 0.22 of its potential returns per unit of risk. Flow Capital Corp is currently generating about -0.22 per unit of risk. If you would invest 3.00 in Eat Well Investment on September 21, 2024 and sell it today you would earn a total of 17.00 from holding Eat Well Investment or generate 566.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eat Well Investment vs. Flow Capital Corp
Performance |
| Timeline |
| Eat Well Investment |
| Flow Capital Corp |
Eat Well and Flow Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eat Well and Flow Capital
The main advantage of trading using opposite Eat Well and Flow Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eat Well position performs unexpectedly, Flow Capital 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 Flow Capital will offset losses from the drop in Flow Capital's long position.| Eat Well vs. Flow Capital Corp | Eat Well vs. Guardian Capital Group | Eat Well vs. Urbana | Eat Well vs. Princeton Capital |
| Flow Capital vs. HUMANA INC | Flow Capital vs. Barloworld Ltd ADR | Flow Capital vs. Morningstar Unconstrained Allocation | Flow Capital vs. Thrivent High Yield |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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