Correlation Between MICRONIC MYDATA and TreeHouse Foods
Can any of the company-specific risk be diversified away by investing in both MICRONIC MYDATA and TreeHouse Foods 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 MICRONIC MYDATA and TreeHouse Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MICRONIC MYDATA and TreeHouse Foods, you can compare the effects of market volatilities on MICRONIC MYDATA and TreeHouse Foods 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 MICRONIC MYDATA with a short position of TreeHouse Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of MICRONIC MYDATA and TreeHouse Foods.
Diversification Opportunities for MICRONIC MYDATA and TreeHouse Foods
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MICRONIC and TreeHouse is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding MICRONIC MYDATA and TreeHouse Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TreeHouse Foods and MICRONIC MYDATA 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 MICRONIC MYDATA are associated (or correlated) with TreeHouse Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TreeHouse Foods has no effect on the direction of MICRONIC MYDATA i.e., MICRONIC MYDATA and TreeHouse Foods go up and down completely randomly.
Pair Corralation between MICRONIC MYDATA and TreeHouse Foods
Assuming the 90 days trading horizon MICRONIC MYDATA is expected to under-perform the TreeHouse Foods. But the stock apears to be less risky and, when comparing its historical volatility, MICRONIC MYDATA is 2.21 times less risky than TreeHouse Foods. The stock trades about -0.18 of its potential returns per unit of risk. The TreeHouse Foods is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 3,400 in TreeHouse Foods on August 31, 2024 and sell it today you would lose (120.00) from holding TreeHouse Foods or give up 3.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
MICRONIC MYDATA vs. TreeHouse Foods
Performance |
| Timeline |
| MICRONIC MYDATA |
| TreeHouse Foods |
MICRONIC MYDATA and TreeHouse Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MICRONIC MYDATA and TreeHouse Foods
The main advantage of trading using opposite MICRONIC MYDATA and TreeHouse Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MICRONIC MYDATA position performs unexpectedly, TreeHouse Foods 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 TreeHouse Foods will offset losses from the drop in TreeHouse Foods' long position.| MICRONIC MYDATA vs. SIVERS SEMICONDUCTORS AB | MICRONIC MYDATA vs. Darden Restaurants | MICRONIC MYDATA vs. Reliance Steel Aluminum | MICRONIC MYDATA vs. Q2M Managementberatung AG |
| TreeHouse Foods vs. Danone SA | TreeHouse Foods vs. Superior Plus Corp | TreeHouse Foods vs. NMI Holdings | TreeHouse Foods vs. Origin Agritech |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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