Correlation Between Hf Foods and SunOpta

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Can any of the company-specific risk be diversified away by investing in both Hf Foods and SunOpta 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 SunOpta 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 SunOpta, you can compare the effects of market volatilities on Hf Foods and SunOpta 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 SunOpta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hf Foods and SunOpta.

Diversification Opportunities for Hf Foods and SunOpta

0.17
  Correlation Coefficient

Average diversification

The 3 months correlation between HFFG and SunOpta is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Hf Foods Group and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta 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 SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of Hf Foods i.e., Hf Foods and SunOpta go up and down completely randomly.

Pair Corralation between Hf Foods and SunOpta

Given the investment horizon of 90 days Hf Foods is expected to generate 41.41 times less return on investment than SunOpta. But when comparing it to its historical volatility, Hf Foods Group is 1.71 times less risky than SunOpta. It trades about 0.02 of its potential returns per unit of risk. SunOpta is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest  598.00  in SunOpta on August 29, 2024 and sell it today you would earn a total of  181.00  from holding SunOpta or generate 30.27% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Hf Foods Group  vs.  SunOpta

 Performance 
       Timeline  
Hf Foods Group 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Hf Foods Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent technical and fundamental indicators, Hf Foods may actually be approaching a critical reversion point that can send shares even higher in December 2024.
SunOpta 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in SunOpta are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite weak forward-looking signals, SunOpta disclosed solid returns over the last few months and may actually be approaching a breakup point.

Hf Foods and SunOpta Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Hf Foods and SunOpta

The main advantage of trading using opposite Hf Foods and SunOpta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hf Foods position performs unexpectedly, SunOpta 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 SunOpta will offset losses from the drop in SunOpta's long position.
The idea behind Hf Foods Group and SunOpta pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.

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