Correlation Between Kellanova and JM Smucker
Can any of the company-specific risk be diversified away by investing in both Kellanova and JM Smucker 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 Kellanova and JM Smucker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kellanova and JM Smucker, you can compare the effects of market volatilities on Kellanova and JM Smucker 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 Kellanova with a short position of JM Smucker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kellanova and JM Smucker.
Diversification Opportunities for Kellanova and JM Smucker
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kellanova and SJM is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Kellanova and JM Smucker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JM Smucker and Kellanova 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 Kellanova are associated (or correlated) with JM Smucker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JM Smucker has no effect on the direction of Kellanova i.e., Kellanova and JM Smucker go up and down completely randomly.
Pair Corralation between Kellanova and JM Smucker
Taking into account the 90-day investment horizon Kellanova is expected to generate 1.16 times more return on investment than JM Smucker. However, Kellanova is 1.16 times more volatile than JM Smucker. It trades about 0.12 of its potential returns per unit of risk. JM Smucker is currently generating about 0.03 per unit of risk. If you would invest 5,036 in Kellanova on August 24, 2024 and sell it today you would earn a total of 3,066 from holding Kellanova or generate 60.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kellanova vs. JM Smucker
Performance |
| Timeline |
| Kellanova |
| JM Smucker |
Kellanova and JM Smucker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kellanova and JM Smucker
The main advantage of trading using opposite Kellanova and JM Smucker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kellanova position performs unexpectedly, JM Smucker 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 JM Smucker will offset losses from the drop in JM Smucker's long position.| Kellanova vs. Campbell Soup | Kellanova vs. ConAgra Foods | Kellanova vs. Hormel Foods | Kellanova vs. Kraft Heinz Co |
| JM Smucker vs. ConAgra Foods | JM Smucker vs. Kellanova | JM Smucker vs. General Mills | JM Smucker vs. Hormel 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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