Correlation Between Smart For and Stryve Foods
Can any of the company-specific risk be diversified away by investing in both Smart For and Stryve 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 Smart For and Stryve Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smart for Life, and Stryve Foods, you can compare the effects of market volatilities on Smart For and Stryve 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 Smart For with a short position of Stryve Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smart For and Stryve Foods.
Diversification Opportunities for Smart For and Stryve Foods
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Smart and Stryve is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Smart for Life, and Stryve Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stryve Foods and Smart For 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 Smart for Life, are associated (or correlated) with Stryve Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stryve Foods has no effect on the direction of Smart For i.e., Smart For and Stryve Foods go up and down completely randomly.
Pair Corralation between Smart For and Stryve Foods
Given the investment horizon of 90 days Smart for Life, is expected to under-perform the Stryve Foods. In addition to that, Smart For is 2.24 times more volatile than Stryve Foods. It trades about -0.1 of its total potential returns per unit of risk. Stryve Foods is currently generating about -0.06 per unit of volatility. If you would invest 1,380 in Stryve Foods on August 27, 2024 and sell it today you would lose (1,284) from holding Stryve Foods or give up 93.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 91.73% |
| Values | Daily Returns |
Smart for Life, vs. Stryve Foods
Performance |
| Timeline |
| Smart for Life, |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Stryve Foods |
Smart For and Stryve Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smart For and Stryve Foods
The main advantage of trading using opposite Smart For and Stryve Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smart For position performs unexpectedly, Stryve 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 Stryve Foods will offset losses from the drop in Stryve Foods' long position.| Smart For vs. Bit Origin | Smart For vs. Better Choice | Smart For vs. Farmmi Inc | Smart For vs. Laird Superfood |
| Stryve Foods vs. Bit Origin | Stryve Foods vs. Laird Superfood | Stryve Foods vs. Planet Green Holdings | Stryve Foods vs. Better Choice |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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