Correlation Between Village Farms and Global Clean
Can any of the company-specific risk be diversified away by investing in both Village Farms and Global Clean 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 Village Farms and Global Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Village Farms International and Global Clean Energy, you can compare the effects of market volatilities on Village Farms and Global Clean 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 Village Farms with a short position of Global Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Village Farms and Global Clean.
Diversification Opportunities for Village Farms and Global Clean
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Village and Global is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Village Farms International and Global Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Clean Energy and Village Farms 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 Village Farms International are associated (or correlated) with Global Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Clean Energy has no effect on the direction of Village Farms i.e., Village Farms and Global Clean go up and down completely randomly.
Pair Corralation between Village Farms and Global Clean
Considering the 90-day investment horizon Village Farms is expected to generate 5.23 times less return on investment than Global Clean. But when comparing it to its historical volatility, Village Farms International is 1.69 times less risky than Global Clean. It trades about 0.01 of its potential returns per unit of risk. Global Clean Energy is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 139.00 in Global Clean Energy on November 5, 2024 and sell it today you would lose (35.00) from holding Global Clean Energy or give up 25.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Village Farms International vs. Global Clean Energy
Performance |
| Timeline |
| Village Farms Intern |
| Global Clean Energy |
Village Farms and Global Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Village Farms and Global Clean
The main advantage of trading using opposite Village Farms and Global Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Village Farms position performs unexpectedly, Global Clean 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 Global Clean will offset losses from the drop in Global Clean's long position.| Village Farms vs. NaturalShrimp | Village Farms vs. AgriFORCE Growing Systems | Village Farms vs. Atlantic Sapphire ASA | Village Farms vs. Fresh Del Monte |
| Global Clean vs. BRF SA ADR | Global Clean vs. Darling Ingredients | Global Clean vs. SunOpta | Global Clean vs. Bellring Brands LLC |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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