Correlation Between Laird Superfood and Natures Sunshine
Can any of the company-specific risk be diversified away by investing in both Laird Superfood and Natures Sunshine 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 Laird Superfood and Natures Sunshine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Laird Superfood and Natures Sunshine Products, you can compare the effects of market volatilities on Laird Superfood and Natures Sunshine 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 Laird Superfood with a short position of Natures Sunshine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Laird Superfood and Natures Sunshine.
Diversification Opportunities for Laird Superfood and Natures Sunshine
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Laird and Natures is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Laird Superfood and Natures Sunshine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natures Sunshine Products and Laird Superfood 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 Laird Superfood are associated (or correlated) with Natures Sunshine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natures Sunshine Products has no effect on the direction of Laird Superfood i.e., Laird Superfood and Natures Sunshine go up and down completely randomly.
Pair Corralation between Laird Superfood and Natures Sunshine
Considering the 90-day investment horizon Laird Superfood is expected to generate 1.44 times more return on investment than Natures Sunshine. However, Laird Superfood is 1.44 times more volatile than Natures Sunshine Products. It trades about 0.17 of its potential returns per unit of risk. Natures Sunshine Products is currently generating about 0.22 per unit of risk. If you would invest 724.00 in Laird Superfood on August 28, 2024 and sell it today you would earn a total of 161.00 from holding Laird Superfood or generate 22.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Laird Superfood vs. Natures Sunshine Products
Performance |
| Timeline |
| Laird Superfood |
| Natures Sunshine Products |
Laird Superfood and Natures Sunshine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Laird Superfood and Natures Sunshine
The main advantage of trading using opposite Laird Superfood and Natures Sunshine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Laird Superfood position performs unexpectedly, Natures Sunshine 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 Natures Sunshine will offset losses from the drop in Natures Sunshine's long position.| Laird Superfood vs. Better Choice | Laird Superfood vs. Sharing Services Global | Laird Superfood vs. Bit Origin | Laird Superfood vs. Planet Green Holdings |
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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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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