Correlation Between Hostess Brands and JM Smucker
Can any of the company-specific risk be diversified away by investing in both Hostess Brands and JM Smucker 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 Hostess Brands and JM Smucker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hostess Brands and JM Smucker, you can compare the effects of market volatilities on Hostess Brands and JM Smucker 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 Hostess Brands with a short position of JM Smucker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hostess Brands and JM Smucker.
Diversification Opportunities for Hostess Brands and JM Smucker
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hostess and SJM is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Hostess Brands and JM Smucker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JM Smucker and Hostess 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 Hostess Brands are associated (or correlated) with JM Smucker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JM Smucker has no effect on the direction of Hostess Brands i.e., Hostess Brands and JM Smucker go up and down completely randomly.
Pair Corralation between Hostess Brands and JM Smucker
If you would invest 11,281 in JM Smucker on August 31, 2024 and sell it today you would earn a total of 519.00 from holding JM Smucker or generate 4.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Hostess Brands vs. JM Smucker
Performance |
| Timeline |
| Hostess Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| JM Smucker |
Hostess Brands and JM Smucker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hostess Brands and JM Smucker
The main advantage of trading using opposite Hostess Brands and JM Smucker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hostess Brands position performs unexpectedly, JM Smucker 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 JM Smucker will offset losses from the drop in JM Smucker's long position.| Hostess Brands vs. Simply Good Foods | Hostess Brands vs. Treehouse Foods | Hostess Brands vs. Post Holdings | Hostess Brands vs. Nomad Foods |
| JM Smucker vs. ConAgra Foods | JM Smucker vs. Kellanova | JM Smucker vs. General Mills | JM Smucker vs. Hormel Foods |
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.
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