Correlation Between SENECA FOODS-A and ACHETER-LOUER
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS-A and ACHETER-LOUER 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-A and ACHETER-LOUER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SENECA FOODS A and ACHETER LOUER EO 145612, you can compare the effects of market volatilities on SENECA FOODS-A and ACHETER-LOUER 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-A with a short position of ACHETER-LOUER. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS-A and ACHETER-LOUER.
Diversification Opportunities for SENECA FOODS-A and ACHETER-LOUER
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SENECA and ACHETER-LOUER is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and ACHETER LOUER EO 145612 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ACHETER LOUER EO and SENECA FOODS-A 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 A are associated (or correlated) with ACHETER-LOUER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ACHETER LOUER EO has no effect on the direction of SENECA FOODS-A i.e., SENECA FOODS-A and ACHETER-LOUER go up and down completely randomly.
Pair Corralation between SENECA FOODS-A and ACHETER-LOUER
Assuming the 90 days trading horizon SENECA FOODS A is expected to generate 0.08 times more return on investment than ACHETER-LOUER. However, SENECA FOODS A is 13.2 times less risky than ACHETER-LOUER. It trades about -0.11 of its potential returns per unit of risk. ACHETER LOUER EO 145612 is currently generating about -0.22 per unit of risk. If you would invest 7,050 in SENECA FOODS A on November 8, 2024 and sell it today you would lose (250.00) from holding SENECA FOODS A or give up 3.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SENECA FOODS A vs. ACHETER LOUER EO 145612
Performance |
| Timeline |
| SENECA FOODS A |
| ACHETER LOUER EO |
SENECA FOODS-A and ACHETER-LOUER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS-A and ACHETER-LOUER
The main advantage of trading using opposite SENECA FOODS-A and ACHETER-LOUER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS-A position performs unexpectedly, ACHETER-LOUER 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 ACHETER-LOUER will offset losses from the drop in ACHETER-LOUER's long position.| SENECA FOODS-A vs. PARKEN Sport Entertainment | SENECA FOODS-A vs. CSSC Offshore Marine | SENECA FOODS-A vs. BOSTON BEER A | SENECA FOODS-A vs. SIERRA METALS |
| ACHETER-LOUER vs. CANON MARKETING JP | ACHETER-LOUER vs. Japan Tobacco | ACHETER-LOUER vs. Indutrade AB | ACHETER-LOUER vs. Advanced Medical Solutions |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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