Correlation Between Hf Foods and Calavo Growers
Can any of the company-specific risk be diversified away by investing in both Hf Foods and Calavo Growers 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 Hf Foods and Calavo Growers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hf Foods Group and Calavo Growers, you can compare the effects of market volatilities on Hf Foods and Calavo Growers 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 Hf Foods with a short position of Calavo Growers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hf Foods and Calavo Growers.
Diversification Opportunities for Hf Foods and Calavo Growers
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HFFG and Calavo is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Hf Foods Group and Calavo Growers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calavo Growers and Hf Foods 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 Hf Foods Group are associated (or correlated) with Calavo Growers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calavo Growers has no effect on the direction of Hf Foods i.e., Hf Foods and Calavo Growers go up and down completely randomly.
Pair Corralation between Hf Foods and Calavo Growers
Given the investment horizon of 90 days Hf Foods is expected to generate 1.91 times less return on investment than Calavo Growers. In addition to that, Hf Foods is 1.2 times more volatile than Calavo Growers. It trades about 0.05 of its total potential returns per unit of risk. Calavo Growers is currently generating about 0.11 per unit of volatility. If you would invest 2,692 in Calavo Growers on August 28, 2024 and sell it today you would earn a total of 101.00 from holding Calavo Growers or generate 3.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hf Foods Group vs. Calavo Growers
Performance |
| Timeline |
| Hf Foods Group |
| Calavo Growers |
Hf Foods and Calavo Growers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hf Foods and Calavo Growers
The main advantage of trading using opposite Hf Foods and Calavo Growers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hf Foods position performs unexpectedly, Calavo Growers 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 Calavo Growers will offset losses from the drop in Calavo Growers' long position.| Hf Foods vs. Innovative Food Hldg | Hf Foods vs. G Willi Food International | Hf Foods vs. Calavo Growers | Hf Foods vs. The Chefs Warehouse |
| Calavo Growers vs. SpartanNash Co | Calavo Growers vs. The Andersons | Calavo Growers vs. The Chefs Warehouse | Calavo Growers vs. Hf Foods Group |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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