Correlation Between General Mills and Stryve Foods
Can any of the company-specific risk be diversified away by investing in both General Mills and Stryve 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 General Mills and Stryve Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Mills and Stryve Foods, you can compare the effects of market volatilities on General Mills and Stryve 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 General Mills with a short position of Stryve Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Mills and Stryve Foods.
Diversification Opportunities for General Mills and Stryve Foods
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between General and Stryve is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding General Mills and Stryve Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stryve Foods and General Mills 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 General Mills are associated (or correlated) with Stryve Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stryve Foods has no effect on the direction of General Mills i.e., General Mills and Stryve Foods go up and down completely randomly.
Pair Corralation between General Mills and Stryve Foods
Considering the 90-day investment horizon General Mills is expected to generate 0.26 times more return on investment than Stryve Foods. However, General Mills is 3.89 times less risky than Stryve Foods. It trades about -0.1 of its potential returns per unit of risk. Stryve Foods is currently generating about -0.04 per unit of risk. If you would invest 6,822 in General Mills on August 31, 2024 and sell it today you would lose (199.00) from holding General Mills or give up 2.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Mills vs. Stryve Foods
Performance |
| Timeline |
| General Mills |
| Stryve Foods |
General Mills and Stryve Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Mills and Stryve Foods
The main advantage of trading using opposite General Mills and Stryve Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Mills position performs unexpectedly, Stryve 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 Stryve Foods will offset losses from the drop in Stryve Foods' long position.| General Mills vs. Campbell Soup | General Mills vs. Kraft Heinz Co | General Mills vs. ConAgra Foods | General Mills vs. Hormel Foods |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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