Correlation Between SENECA FOODS and TROPHY GAMES
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS and TROPHY GAMES 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 and TROPHY GAMES 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 TROPHY GAMES DEV, you can compare the effects of market volatilities on SENECA FOODS and TROPHY GAMES 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 with a short position of TROPHY GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS and TROPHY GAMES.
Diversification Opportunities for SENECA FOODS and TROPHY GAMES
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SENECA and TROPHY is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and TROPHY GAMES DEV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TROPHY GAMES DEV and SENECA FOODS 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 TROPHY GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TROPHY GAMES DEV has no effect on the direction of SENECA FOODS i.e., SENECA FOODS and TROPHY GAMES go up and down completely randomly.
Pair Corralation between SENECA FOODS and TROPHY GAMES
Assuming the 90 days trading horizon SENECA FOODS A is expected to generate 1.09 times more return on investment than TROPHY GAMES. However, SENECA FOODS is 1.09 times more volatile than TROPHY GAMES DEV. It trades about 0.27 of its potential returns per unit of risk. TROPHY GAMES DEV is currently generating about -0.17 per unit of risk. If you would invest 5,650 in SENECA FOODS A on August 30, 2024 and sell it today you would earn a total of 950.00 from holding SENECA FOODS A or generate 16.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SENECA FOODS A vs. TROPHY GAMES DEV
Performance |
| Timeline |
| SENECA FOODS A |
| TROPHY GAMES DEV |
SENECA FOODS and TROPHY GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS and TROPHY GAMES
The main advantage of trading using opposite SENECA FOODS and TROPHY GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS position performs unexpectedly, TROPHY GAMES 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 TROPHY GAMES will offset losses from the drop in TROPHY GAMES's long position.| SENECA FOODS vs. REGAL ASIAN INVESTMENTS | SENECA FOODS vs. Chuangs China Investments | SENECA FOODS vs. Methode Electronics | SENECA FOODS vs. LPKF Laser Electronics |
| TROPHY GAMES vs. Sea Limited | TROPHY GAMES vs. Superior Plus Corp | TROPHY GAMES vs. NMI Holdings | TROPHY GAMES vs. SIVERS SEMICONDUCTORS AB |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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