Correlation Between Seneca Foods and Grupo Bimbo
Can any of the company-specific risk be diversified away by investing in both Seneca Foods and Grupo Bimbo 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 Seneca Foods and Grupo Bimbo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seneca Foods Corp and Grupo Bimbo SAB, you can compare the effects of market volatilities on Seneca Foods and Grupo Bimbo 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 Seneca Foods with a short position of Grupo Bimbo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seneca Foods and Grupo Bimbo.
Diversification Opportunities for Seneca Foods and Grupo Bimbo
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Seneca and Grupo is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Seneca Foods Corp and Grupo Bimbo SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Bimbo SAB and Seneca 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 Seneca Foods Corp are associated (or correlated) with Grupo Bimbo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Bimbo SAB has no effect on the direction of Seneca Foods i.e., Seneca Foods and Grupo Bimbo go up and down completely randomly.
Pair Corralation between Seneca Foods and Grupo Bimbo
Assuming the 90 days horizon Seneca Foods Corp is expected to generate 0.86 times more return on investment than Grupo Bimbo. However, Seneca Foods Corp is 1.16 times less risky than Grupo Bimbo. It trades about 0.03 of its potential returns per unit of risk. Grupo Bimbo SAB is currently generating about -0.02 per unit of risk. If you would invest 6,168 in Seneca Foods Corp on September 14, 2024 and sell it today you would earn a total of 1,283 from holding Seneca Foods Corp or generate 20.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 88.66% |
| Values | Daily Returns |
Seneca Foods Corp vs. Grupo Bimbo SAB
Performance |
| Timeline |
| Seneca Foods Corp |
| Grupo Bimbo SAB |
Seneca Foods and Grupo Bimbo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seneca Foods and Grupo Bimbo
The main advantage of trading using opposite Seneca Foods and Grupo Bimbo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seneca Foods position performs unexpectedly, Grupo Bimbo 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 Grupo Bimbo will offset losses from the drop in Grupo Bimbo's long position.| Seneca Foods vs. Central Garden Pet | Seneca Foods vs. Central Garden Pet | Seneca Foods vs. Natures Sunshine Products | Seneca Foods vs. Associated British Foods |
| Grupo Bimbo vs. Treehouse Foods | Grupo Bimbo vs. Lancaster Colony | Grupo Bimbo vs. Utz Brands | Grupo Bimbo vs. Lamb Weston Holdings |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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