Correlation Between SENECA FOODS-A and AM EAGLE
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS-A and AM EAGLE 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 AM EAGLE 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 AM EAGLE OUTFITTERS, you can compare the effects of market volatilities on SENECA FOODS-A and AM EAGLE 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 AM EAGLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS-A and AM EAGLE.
Diversification Opportunities for SENECA FOODS-A and AM EAGLE
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SENECA and AFG is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and AM EAGLE OUTFITTERS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AM EAGLE OUTFITTERS 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 AM EAGLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AM EAGLE OUTFITTERS has no effect on the direction of SENECA FOODS-A i.e., SENECA FOODS-A and AM EAGLE go up and down completely randomly.
Pair Corralation between SENECA FOODS-A and AM EAGLE
Assuming the 90 days trading horizon SENECA FOODS A is expected to generate 0.94 times more return on investment than AM EAGLE. However, SENECA FOODS A is 1.07 times less risky than AM EAGLE. It trades about 0.07 of its potential returns per unit of risk. AM EAGLE OUTFITTERS is currently generating about 0.02 per unit of risk. If you would invest 4,620 in SENECA FOODS A on September 3, 2024 and sell it today you would earn a total of 1,830 from holding SENECA FOODS A or generate 39.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SENECA FOODS A vs. AM EAGLE OUTFITTERS
Performance |
| Timeline |
| SENECA FOODS A |
| AM EAGLE OUTFITTERS |
SENECA FOODS-A and AM EAGLE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS-A and AM EAGLE
The main advantage of trading using opposite SENECA FOODS-A and AM EAGLE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS-A position performs unexpectedly, AM EAGLE 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 AM EAGLE will offset losses from the drop in AM EAGLE's long position.| SENECA FOODS-A vs. TOTAL GABON | SENECA FOODS-A vs. Walgreens Boots Alliance | SENECA FOODS-A vs. Banco Santander SA | SENECA FOODS-A vs. Peak Resources Limited |
| AM EAGLE vs. TOTAL GABON | AM EAGLE vs. Walgreens Boots Alliance | AM EAGLE vs. Banco Santander SA | AM EAGLE vs. Peak Resources Limited |
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 CEOs Directory module to screen CEOs from public companies around the world.
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