Correlation Between SENECA FOODS-A and Equitable Holdings
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS-A and Equitable Holdings 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 Equitable Holdings 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 Equitable Holdings, you can compare the effects of market volatilities on SENECA FOODS-A and Equitable Holdings 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 Equitable Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS-A and Equitable Holdings.
Diversification Opportunities for SENECA FOODS-A and Equitable Holdings
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SENECA and Equitable is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and Equitable Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equitable Holdings 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 Equitable Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equitable Holdings has no effect on the direction of SENECA FOODS-A i.e., SENECA FOODS-A and Equitable Holdings go up and down completely randomly.
Pair Corralation between SENECA FOODS-A and Equitable Holdings
Assuming the 90 days trading horizon SENECA FOODS-A is expected to generate 1.21 times less return on investment than Equitable Holdings. In addition to that, SENECA FOODS-A is 1.21 times more volatile than Equitable Holdings. It trades about 0.09 of its total potential returns per unit of risk. Equitable Holdings is currently generating about 0.13 per unit of volatility. If you would invest 2,964 in Equitable Holdings on September 1, 2024 and sell it today you would earn a total of 1,516 from holding Equitable Holdings or generate 51.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.48% |
| Values | Daily Returns |
SENECA FOODS A vs. Equitable Holdings
Performance |
| Timeline |
| SENECA FOODS A |
| Equitable Holdings |
SENECA FOODS-A and Equitable Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS-A and Equitable Holdings
The main advantage of trading using opposite SENECA FOODS-A and Equitable Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS-A position performs unexpectedly, Equitable Holdings 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 Equitable Holdings will offset losses from the drop in Equitable Holdings' 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 |
| Equitable Holdings vs. NN Group NV | Equitable Holdings vs. Superior Plus Corp | Equitable Holdings vs. Origin Agritech | Equitable Holdings vs. Identiv |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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