Correlation Between Ingredion Incorporated and Hain Celestial
Can any of the company-specific risk be diversified away by investing in both Ingredion Incorporated and Hain Celestial 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 Ingredion Incorporated and Hain Celestial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingredion Incorporated and The Hain Celestial, you can compare the effects of market volatilities on Ingredion Incorporated and Hain Celestial 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 Ingredion Incorporated with a short position of Hain Celestial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingredion Incorporated and Hain Celestial.
Diversification Opportunities for Ingredion Incorporated and Hain Celestial
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ingredion and Hain is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Ingredion Incorporated and The Hain Celestial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hain Celestial and Ingredion Incorporated 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 Ingredion Incorporated are associated (or correlated) with Hain Celestial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hain Celestial has no effect on the direction of Ingredion Incorporated i.e., Ingredion Incorporated and Hain Celestial go up and down completely randomly.
Pair Corralation between Ingredion Incorporated and Hain Celestial
Given the investment horizon of 90 days Ingredion Incorporated is expected to generate 0.43 times more return on investment than Hain Celestial. However, Ingredion Incorporated is 2.3 times less risky than Hain Celestial. It trades about 0.11 of its potential returns per unit of risk. The Hain Celestial is currently generating about -0.01 per unit of risk. If you would invest 9,430 in Ingredion Incorporated on August 25, 2024 and sell it today you would earn a total of 5,217 from holding Ingredion Incorporated or generate 55.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingredion Incorporated vs. The Hain Celestial
Performance |
| Timeline |
| Ingredion Incorporated |
| Hain Celestial |
Ingredion Incorporated and Hain Celestial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingredion Incorporated and Hain Celestial
The main advantage of trading using opposite Ingredion Incorporated and Hain Celestial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingredion Incorporated position performs unexpectedly, Hain Celestial 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 Hain Celestial will offset losses from the drop in Hain Celestial's long position.| Ingredion Incorporated vs. Lancaster Colony | Ingredion Incorporated vs. Treehouse Foods | Ingredion Incorporated vs. John B Sanfilippo | Ingredion Incorporated vs. Seneca Foods Corp |
| Hain Celestial vs. J J Snack | Hain Celestial vs. Lancaster Colony | Hain Celestial vs. Treehouse Foods | Hain Celestial vs. Simply Good Foods |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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