Correlation Between Highwood Asset and Goodfood Market
Can any of the company-specific risk be diversified away by investing in both Highwood Asset and Goodfood Market 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 Highwood Asset and Goodfood Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highwood Asset Management and Goodfood Market Corp, you can compare the effects of market volatilities on Highwood Asset and Goodfood Market 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 Highwood Asset with a short position of Goodfood Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highwood Asset and Goodfood Market.
Diversification Opportunities for Highwood Asset and Goodfood Market
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Highwood and Goodfood is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Highwood Asset Management and Goodfood Market Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goodfood Market Corp and Highwood Asset 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 Highwood Asset Management are associated (or correlated) with Goodfood Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goodfood Market Corp has no effect on the direction of Highwood Asset i.e., Highwood Asset and Goodfood Market go up and down completely randomly.
Pair Corralation between Highwood Asset and Goodfood Market
Assuming the 90 days horizon Highwood Asset is expected to generate 5.18 times less return on investment than Goodfood Market. But when comparing it to its historical volatility, Highwood Asset Management is 3.54 times less risky than Goodfood Market. It trades about 0.22 of its potential returns per unit of risk. Goodfood Market Corp is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 30.00 in Goodfood Market Corp on September 1, 2024 and sell it today you would earn a total of 15.00 from holding Goodfood Market Corp or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Highwood Asset Management vs. Goodfood Market Corp
Performance |
| Timeline |
| Highwood Asset Management |
| Goodfood Market Corp |
Highwood Asset and Goodfood Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highwood Asset and Goodfood Market
The main advantage of trading using opposite Highwood Asset and Goodfood Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highwood Asset position performs unexpectedly, Goodfood Market 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 Goodfood Market will offset losses from the drop in Goodfood Market's long position.| Highwood Asset vs. Walmart Inc CDR | Highwood Asset vs. Amazon CDR | Highwood Asset vs. Berkshire Hathaway CDR | Highwood Asset vs. UnitedHealth Group CDR |
| Goodfood Market vs. WELL Health Technologies | Goodfood Market vs. Lightspeed Commerce | Goodfood Market vs. iShares Canadian HYBrid | Goodfood Market vs. Altagas Cum Red |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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