Correlation Between Nissin Foods and A Schulman
Can any of the company-specific risk be diversified away by investing in both Nissin Foods and A Schulman 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 Nissin Foods and A Schulman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nissin Foods Holdings and A Schulman, you can compare the effects of market volatilities on Nissin Foods and A Schulman 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 Nissin Foods with a short position of A Schulman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nissin Foods and A Schulman.
Diversification Opportunities for Nissin Foods and A Schulman
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nissin and SLMNP is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Nissin Foods Holdings and A Schulman in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A Schulman and Nissin Foods 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 Nissin Foods Holdings are associated (or correlated) with A Schulman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A Schulman has no effect on the direction of Nissin Foods i.e., Nissin Foods and A Schulman go up and down completely randomly.
Pair Corralation between Nissin Foods and A Schulman
Assuming the 90 days horizon Nissin Foods Holdings is expected to generate 4.47 times more return on investment than A Schulman. However, Nissin Foods is 4.47 times more volatile than A Schulman. It trades about 0.05 of its potential returns per unit of risk. A Schulman is currently generating about 0.03 per unit of risk. If you would invest 7,596 in Nissin Foods Holdings on September 3, 2024 and sell it today you would lose (5,176) from holding Nissin Foods Holdings or give up 68.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.29% |
| Values | Daily Returns |
Nissin Foods Holdings vs. A Schulman
Performance |
| Timeline |
| Nissin Foods Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| A Schulman |
Nissin Foods and A Schulman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nissin Foods and A Schulman
The main advantage of trading using opposite Nissin Foods and A Schulman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nissin Foods position performs unexpectedly, A Schulman 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 A Schulman will offset losses from the drop in A Schulman's long position.| Nissin Foods vs. Campbell Soup | Nissin Foods vs. McCormick Company Incorporated | Nissin Foods vs. Hormel Foods | Nissin Foods vs. General Mills |
| A Schulman vs. BASF SE NA | A Schulman vs. Braskem SA Class | A Schulman vs. Lsb Industries | A Schulman vs. Dow Inc |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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