Correlation Between RETAIL FOOD and Natural Health

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both RETAIL FOOD and Natural Health 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 RETAIL FOOD and Natural Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RETAIL FOOD GROUP and Natural Health Trends, you can compare the effects of market volatilities on RETAIL FOOD and Natural Health 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 RETAIL FOOD with a short position of Natural Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of RETAIL FOOD and Natural Health.

Diversification Opportunities for RETAIL FOOD and Natural Health

0.04
  Correlation Coefficient

Significant diversification

The 3 months correlation between RETAIL and Natural is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding RETAIL FOOD GROUP and Natural Health Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natural Health Trends and RETAIL FOOD 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 RETAIL FOOD GROUP are associated (or correlated) with Natural Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natural Health Trends has no effect on the direction of RETAIL FOOD i.e., RETAIL FOOD and Natural Health go up and down completely randomly.

Pair Corralation between RETAIL FOOD and Natural Health

Assuming the 90 days trading horizon RETAIL FOOD GROUP is expected to generate 0.78 times more return on investment than Natural Health. However, RETAIL FOOD GROUP is 1.29 times less risky than Natural Health. It trades about 0.24 of its potential returns per unit of risk. Natural Health Trends is currently generating about 0.05 per unit of risk. If you would invest  3.70  in RETAIL FOOD GROUP on August 28, 2024 and sell it today you would earn a total of  0.50  from holding RETAIL FOOD GROUP or generate 13.51% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy95.45%
ValuesDaily Returns

RETAIL FOOD GROUP  vs.  Natural Health Trends

 Performance 
       Timeline  
RETAIL FOOD GROUP 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in RETAIL FOOD GROUP are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, RETAIL FOOD may actually be approaching a critical reversion point that can send shares even higher in December 2024.
Natural Health Trends 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Natural Health Trends has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

RETAIL FOOD and Natural Health Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with RETAIL FOOD and Natural Health

The main advantage of trading using opposite RETAIL FOOD and Natural Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RETAIL FOOD position performs unexpectedly, Natural Health 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 Natural Health will offset losses from the drop in Natural Health's long position.
The idea behind RETAIL FOOD GROUP and Natural Health Trends 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.

Other Complementary Tools

Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
CEOs Directory
Screen CEOs from public companies around the world
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios