Correlation Between SENECA FOODS-A and ADRIATIC METALS
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS-A and ADRIATIC METALS 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 ADRIATIC METALS 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 ADRIATIC METALS LS 013355, you can compare the effects of market volatilities on SENECA FOODS-A and ADRIATIC METALS 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 ADRIATIC METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS-A and ADRIATIC METALS.
Diversification Opportunities for SENECA FOODS-A and ADRIATIC METALS
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SENECA and ADRIATIC is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and ADRIATIC METALS LS 013355 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADRIATIC METALS LS 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 ADRIATIC METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADRIATIC METALS LS has no effect on the direction of SENECA FOODS-A i.e., SENECA FOODS-A and ADRIATIC METALS go up and down completely randomly.
Pair Corralation between SENECA FOODS-A and ADRIATIC METALS
Assuming the 90 days trading horizon SENECA FOODS A is expected to generate 0.9 times more return on investment than ADRIATIC METALS. However, SENECA FOODS A is 1.12 times less risky than ADRIATIC METALS. It trades about 0.28 of its potential returns per unit of risk. ADRIATIC METALS LS 013355 is currently generating about 0.04 per unit of risk. If you would invest 5,500 in SENECA FOODS A on September 1, 2024 and sell it today you would earn a total of 950.00 from holding SENECA FOODS A or generate 17.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SENECA FOODS A vs. ADRIATIC METALS LS 013355
Performance |
| Timeline |
| SENECA FOODS A |
| ADRIATIC METALS LS |
SENECA FOODS-A and ADRIATIC METALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS-A and ADRIATIC METALS
The main advantage of trading using opposite SENECA FOODS-A and ADRIATIC METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS-A position performs unexpectedly, ADRIATIC METALS 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 ADRIATIC METALS will offset losses from the drop in ADRIATIC METALS's long position.| SENECA FOODS-A vs. SIVERS SEMICONDUCTORS AB | SENECA FOODS-A vs. Darden Restaurants | SENECA FOODS-A vs. Reliance Steel Aluminum | SENECA FOODS-A vs. Q2M Managementberatung AG |
| ADRIATIC METALS vs. PUBLIC STORAGE PRFO | ADRIATIC METALS vs. BE Semiconductor Industries | ADRIATIC METALS vs. Datang International Power | ADRIATIC METALS vs. Elmos Semiconductor SE |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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