Correlation Between Marfrig Global and Bridgford Foods
Can any of the company-specific risk be diversified away by investing in both Marfrig Global and Bridgford 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 Marfrig Global and Bridgford Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marfrig Global Foods and Bridgford Foods, you can compare the effects of market volatilities on Marfrig Global and Bridgford 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 Marfrig Global with a short position of Bridgford Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfrig Global and Bridgford Foods.
Diversification Opportunities for Marfrig Global and Bridgford Foods
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Marfrig and Bridgford is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Marfrig Global Foods and Bridgford Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridgford Foods and Marfrig Global 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 Marfrig Global Foods are associated (or correlated) with Bridgford Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridgford Foods has no effect on the direction of Marfrig Global i.e., Marfrig Global and Bridgford Foods go up and down completely randomly.
Pair Corralation between Marfrig Global and Bridgford Foods
Assuming the 90 days horizon Marfrig Global Foods is expected to generate 1.72 times more return on investment than Bridgford Foods. However, Marfrig Global is 1.72 times more volatile than Bridgford Foods. It trades about 0.25 of its potential returns per unit of risk. Bridgford Foods is currently generating about 0.1 per unit of risk. If you would invest 248.00 in Marfrig Global Foods on August 25, 2024 and sell it today you would earn a total of 45.00 from holding Marfrig Global Foods or generate 18.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Marfrig Global Foods vs. Bridgford Foods
Performance |
| Timeline |
| Marfrig Global Foods |
| Bridgford Foods |
Marfrig Global and Bridgford Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marfrig Global and Bridgford Foods
The main advantage of trading using opposite Marfrig Global and Bridgford Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marfrig Global position performs unexpectedly, Bridgford 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 Bridgford Foods will offset losses from the drop in Bridgford Foods' long position.| Marfrig Global vs. Artisan Consumer Goods | Marfrig Global vs. Aryzta AG PK | Marfrig Global vs. The A2 Milk | Marfrig Global vs. BioAdaptives |
| Bridgford Foods vs. Bellring Brands LLC | Bridgford Foods vs. Ingredion Incorporated | Bridgford Foods vs. JM Smucker | Bridgford Foods vs. John B Sanfilippo |
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.
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