Correlation Between Natural Alternatives and Mamas Creations
Can any of the company-specific risk be diversified away by investing in both Natural Alternatives and Mamas Creations 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 Natural Alternatives and Mamas Creations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Natural Alternatives International and Mamas Creations, you can compare the effects of market volatilities on Natural Alternatives and Mamas Creations 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 Natural Alternatives with a short position of Mamas Creations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Natural Alternatives and Mamas Creations.
Diversification Opportunities for Natural Alternatives and Mamas Creations
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Natural and Mamas is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Natural Alternatives Internati and Mamas Creations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mamas Creations and Natural Alternatives 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 Natural Alternatives International are associated (or correlated) with Mamas Creations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mamas Creations has no effect on the direction of Natural Alternatives i.e., Natural Alternatives and Mamas Creations go up and down completely randomly.
Pair Corralation between Natural Alternatives and Mamas Creations
Given the investment horizon of 90 days Natural Alternatives International is expected to under-perform the Mamas Creations. But the stock apears to be less risky and, when comparing its historical volatility, Natural Alternatives International is 1.61 times less risky than Mamas Creations. The stock trades about -0.09 of its potential returns per unit of risk. The Mamas Creations is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 771.00 in Mamas Creations on August 28, 2024 and sell it today you would earn a total of 159.00 from holding Mamas Creations or generate 20.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Natural Alternatives Internati vs. Mamas Creations
Performance |
| Timeline |
| Natural Alternatives |
| Mamas Creations |
Natural Alternatives and Mamas Creations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Natural Alternatives and Mamas Creations
The main advantage of trading using opposite Natural Alternatives and Mamas Creations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Natural Alternatives position performs unexpectedly, Mamas Creations 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 Mamas Creations will offset losses from the drop in Mamas Creations' long position.| Natural Alternatives vs. FitLife Brands, Common | Natural Alternatives vs. Lifeway Foods | Natural Alternatives vs. Else Nutrition Holdings | Natural Alternatives vs. Central Garden Pet |
| Mamas Creations vs. Inuvo Inc | Mamas Creations vs. Vestis | Mamas Creations vs. Global E Online | Mamas Creations vs. Lendlease Global Commercial |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |