Correlation Between SENECA FOODS and Gaztransport Technigaz
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS and Gaztransport Technigaz 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 Gaztransport Technigaz 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 Gaztransport Technigaz SA, you can compare the effects of market volatilities on SENECA FOODS and Gaztransport Technigaz 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 Gaztransport Technigaz. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS and Gaztransport Technigaz.
Diversification Opportunities for SENECA FOODS and Gaztransport Technigaz
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SENECA and Gaztransport is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and Gaztransport Technigaz SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport Technigaz 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 Gaztransport Technigaz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport Technigaz has no effect on the direction of SENECA FOODS i.e., SENECA FOODS and Gaztransport Technigaz go up and down completely randomly.
Pair Corralation between SENECA FOODS and Gaztransport Technigaz
Assuming the 90 days trading horizon SENECA FOODS A is expected to generate 1.06 times more return on investment than Gaztransport Technigaz. However, SENECA FOODS is 1.06 times more volatile than Gaztransport Technigaz SA. It trades about 0.4 of its potential returns per unit of risk. Gaztransport Technigaz SA is currently generating about -0.14 per unit of risk. If you would invest 5,800 in SENECA FOODS A on September 12, 2024 and sell it today you would earn a total of 950.00 from holding SENECA FOODS A or generate 16.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
SENECA FOODS A vs. Gaztransport Technigaz SA
Performance |
| Timeline |
| SENECA FOODS A |
| Gaztransport Technigaz |
SENECA FOODS and Gaztransport Technigaz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS and Gaztransport Technigaz
The main advantage of trading using opposite SENECA FOODS and Gaztransport Technigaz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS position performs unexpectedly, Gaztransport Technigaz 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 Gaztransport Technigaz will offset losses from the drop in Gaztransport Technigaz's long position.| SENECA FOODS vs. Xenia Hotels Resorts | SENECA FOODS vs. COSTCO WHOLESALE CDR | SENECA FOODS vs. Hyatt Hotels | SENECA FOODS vs. Ross Stores |
| Gaztransport Technigaz vs. Tenaris SA | Gaztransport Technigaz vs. NOV Inc | Gaztransport Technigaz vs. Superior Plus Corp | Gaztransport Technigaz 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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