Correlation Between Sow Good and Borealis Foods
Can any of the company-specific risk be diversified away by investing in both Sow Good and Borealis 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 Sow Good and Borealis Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sow Good Common and Borealis Foods, you can compare the effects of market volatilities on Sow Good and Borealis 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 Sow Good with a short position of Borealis Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sow Good and Borealis Foods.
Diversification Opportunities for Sow Good and Borealis Foods
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sow and Borealis is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Sow Good Common and Borealis Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Borealis Foods and Sow Good 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 Sow Good Common are associated (or correlated) with Borealis Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Borealis Foods has no effect on the direction of Sow Good i.e., Sow Good and Borealis Foods go up and down completely randomly.
Pair Corralation between Sow Good and Borealis Foods
Given the investment horizon of 90 days Sow Good Common is expected to under-perform the Borealis Foods. In addition to that, Sow Good is 1.6 times more volatile than Borealis Foods. It trades about -0.23 of its total potential returns per unit of risk. Borealis Foods is currently generating about 0.08 per unit of volatility. If you would invest 6.50 in Borealis Foods on August 28, 2024 and sell it today you would earn a total of 0.50 from holding Borealis Foods or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Sow Good Common vs. Borealis Foods
Performance |
| Timeline |
| Sow Good Common |
| Borealis Foods |
Sow Good and Borealis Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sow Good and Borealis Foods
The main advantage of trading using opposite Sow Good and Borealis Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sow Good position performs unexpectedly, Borealis 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 Borealis Foods will offset losses from the drop in Borealis Foods' long position.| Sow Good vs. Pilgrims Pride Corp | Sow Good vs. Treehouse Foods | Sow Good vs. The Hain Celestial | Sow Good vs. Lancaster Colony |
| Borealis Foods vs. Lamb Weston Holdings | Borealis Foods vs. Westrock Coffee | Borealis Foods vs. Farmmi Inc | Borealis Foods vs. Farmer Bros Co |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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