Correlation Between Whole Earth and Bridgford Foods
Can any of the company-specific risk be diversified away by investing in both Whole Earth and Bridgford Foods 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 Whole Earth and Bridgford Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Whole Earth Brands and Bridgford Foods, you can compare the effects of market volatilities on Whole Earth and Bridgford Foods 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 Whole Earth with a short position of Bridgford Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Whole Earth and Bridgford Foods.
Diversification Opportunities for Whole Earth and Bridgford Foods
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Whole and Bridgford is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Whole Earth Brands and Bridgford Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridgford Foods and Whole Earth 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 Whole Earth Brands are associated (or correlated) with Bridgford Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridgford Foods has no effect on the direction of Whole Earth i.e., Whole Earth and Bridgford Foods go up and down completely randomly.
Pair Corralation between Whole Earth and Bridgford Foods
Given the investment horizon of 90 days Whole Earth Brands is expected to under-perform the Bridgford Foods. In addition to that, Whole Earth is 2.9 times more volatile than Bridgford Foods. It trades about -0.04 of its total potential returns per unit of risk. Bridgford Foods is currently generating about -0.01 per unit of volatility. If you would invest 1,055 in Bridgford Foods on September 1, 2024 and sell it today you would lose (148.00) from holding Bridgford Foods or give up 14.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 71.05% |
| Values | Daily Returns |
Whole Earth Brands vs. Bridgford Foods
Performance |
| Timeline |
| Whole Earth Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Bridgford Foods |
Whole Earth and Bridgford Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Whole Earth and Bridgford Foods
The main advantage of trading using opposite Whole Earth and Bridgford Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Whole Earth position performs unexpectedly, Bridgford Foods 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 Bridgford Foods will offset losses from the drop in Bridgford Foods' long position.| Whole Earth vs. Seneca Foods Corp | Whole Earth vs. Lifeway Foods | Whole Earth vs. John B Sanfilippo | Whole Earth vs. Real Good Food |
| Bridgford Foods vs. Seneca Foods Corp | Bridgford Foods vs. J J Snack | Bridgford Foods vs. Central Garden Pet | Bridgford Foods vs. Central Garden Pet |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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