Correlation Between BANNER and SENECA FOODS-A
Can any of the company-specific risk be diversified away by investing in both BANNER and SENECA FOODS-A 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 BANNER and SENECA FOODS-A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BANNER and SENECA FOODS A, you can compare the effects of market volatilities on BANNER and SENECA FOODS-A 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 BANNER with a short position of SENECA FOODS-A. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANNER and SENECA FOODS-A.
Diversification Opportunities for BANNER and SENECA FOODS-A
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BANNER and SENECA is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding BANNER and SENECA FOODS A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SENECA FOODS A and BANNER 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 BANNER are associated (or correlated) with SENECA FOODS-A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SENECA FOODS A has no effect on the direction of BANNER i.e., BANNER and SENECA FOODS-A go up and down completely randomly.
Pair Corralation between BANNER and SENECA FOODS-A
Assuming the 90 days trading horizon BANNER is expected to generate 0.94 times more return on investment than SENECA FOODS-A. However, BANNER is 1.06 times less risky than SENECA FOODS-A. It trades about 0.19 of its potential returns per unit of risk. SENECA FOODS A is currently generating about 0.15 per unit of risk. If you would invest 5,208 in BANNER on September 5, 2024 and sell it today you would earn a total of 1,842 from holding BANNER or generate 35.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.46% |
| Values | Daily Returns |
BANNER vs. SENECA FOODS A
Performance |
| Timeline |
| BANNER |
| SENECA FOODS A |
BANNER and SENECA FOODS-A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANNER and SENECA FOODS-A
The main advantage of trading using opposite BANNER and SENECA FOODS-A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANNER position performs unexpectedly, SENECA FOODS-A 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 SENECA FOODS-A will offset losses from the drop in SENECA FOODS-A's long position.| BANNER vs. Scandinavian Tobacco Group | BANNER vs. The Hanover Insurance | BANNER vs. British American Tobacco | BANNER vs. Japan Tobacco |
| SENECA FOODS-A vs. TOTAL GABON | SENECA FOODS-A vs. Walgreens Boots Alliance | SENECA FOODS-A vs. Peak Resources Limited |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Global Correlations Find global opportunities by holding instruments from different markets |