Correlation Between Premium Brands and Rogers Sugar
Can any of the company-specific risk be diversified away by investing in both Premium Brands and Rogers Sugar 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 Premium Brands and Rogers Sugar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Premium Brands Holdings and Rogers Sugar, you can compare the effects of market volatilities on Premium Brands and Rogers Sugar 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 Premium Brands with a short position of Rogers Sugar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Premium Brands and Rogers Sugar.
Diversification Opportunities for Premium Brands and Rogers Sugar
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Premium and Rogers is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Premium Brands Holdings and Rogers Sugar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rogers Sugar and Premium Brands 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 Premium Brands Holdings are associated (or correlated) with Rogers Sugar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rogers Sugar has no effect on the direction of Premium Brands i.e., Premium Brands and Rogers Sugar go up and down completely randomly.
Pair Corralation between Premium Brands and Rogers Sugar
Assuming the 90 days trading horizon Premium Brands is expected to generate 11.61 times less return on investment than Rogers Sugar. But when comparing it to its historical volatility, Premium Brands Holdings is 1.3 times less risky than Rogers Sugar. It trades about 0.01 of its potential returns per unit of risk. Rogers Sugar is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 579.00 in Rogers Sugar on September 26, 2024 and sell it today you would earn a total of 23.00 from holding Rogers Sugar or generate 3.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Premium Brands Holdings vs. Rogers Sugar
Performance |
| Timeline |
| Premium Brands Holdings |
| Rogers Sugar |
Premium Brands and Rogers Sugar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Premium Brands and Rogers Sugar
The main advantage of trading using opposite Premium Brands and Rogers Sugar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Premium Brands position performs unexpectedly, Rogers Sugar 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 Rogers Sugar will offset losses from the drop in Rogers Sugar's long position.| Premium Brands vs. CCL Industries | Premium Brands vs. North West | Premium Brands vs. Maple Leaf Foods | Premium Brands vs. FirstService Corp |
| Rogers Sugar vs. Empire Company Limited | Rogers Sugar vs. Premium Brands Holdings | Rogers Sugar vs. Metro 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Transaction History View history of all your transactions and understand their impact on performance |