Correlation Between SENECA FOODS-A and TIANDE CHEMICAL
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS-A and TIANDE CHEMICAL 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 TIANDE CHEMICAL 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 TIANDE CHEMICAL, you can compare the effects of market volatilities on SENECA FOODS-A and TIANDE CHEMICAL 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 TIANDE CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS-A and TIANDE CHEMICAL.
Diversification Opportunities for SENECA FOODS-A and TIANDE CHEMICAL
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SENECA and TIANDE is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and TIANDE CHEMICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TIANDE CHEMICAL 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 TIANDE CHEMICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TIANDE CHEMICAL has no effect on the direction of SENECA FOODS-A i.e., SENECA FOODS-A and TIANDE CHEMICAL go up and down completely randomly.
Pair Corralation between SENECA FOODS-A and TIANDE CHEMICAL
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. TIANDE CHEMICAL
Performance |
| Timeline |
| SENECA FOODS A |
| TIANDE CHEMICAL |
SENECA FOODS-A and TIANDE CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS-A and TIANDE CHEMICAL
The main advantage of trading using opposite SENECA FOODS-A and TIANDE CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS-A position performs unexpectedly, TIANDE CHEMICAL 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 TIANDE CHEMICAL will offset losses from the drop in TIANDE CHEMICAL'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 |
| TIANDE CHEMICAL vs. Cal Maine Foods | TIANDE CHEMICAL vs. JJ SNACK FOODS | TIANDE CHEMICAL vs. TreeHouse Foods | TIANDE CHEMICAL vs. CN MODERN DAIRY |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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