Correlation Between SENECA FOODS-A and Tyson Foods
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS-A and Tyson Foods 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 Tyson Foods 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 Tyson Foods, you can compare the effects of market volatilities on SENECA FOODS-A and Tyson Foods 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 Tyson Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS-A and Tyson Foods.
Diversification Opportunities for SENECA FOODS-A and Tyson Foods
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SENECA and Tyson is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and Tyson Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tyson Foods 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 Tyson Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tyson Foods has no effect on the direction of SENECA FOODS-A i.e., SENECA FOODS-A and Tyson Foods go up and down completely randomly.
Pair Corralation between SENECA FOODS-A and Tyson Foods
Assuming the 90 days trading horizon SENECA FOODS A is expected to generate 1.51 times more return on investment than Tyson Foods. However, SENECA FOODS-A is 1.51 times more volatile than Tyson Foods. It trades about 0.28 of its potential returns per unit of risk. Tyson Foods is currently generating about 0.3 per unit of risk. If you would invest 5,500 in SENECA FOODS A on August 24, 2024 and sell it today you would earn a total of 900.00 from holding SENECA FOODS A or generate 16.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SENECA FOODS A vs. Tyson Foods
Performance |
| Timeline |
| SENECA FOODS A |
| Tyson Foods |
SENECA FOODS-A and Tyson Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS-A and Tyson Foods
The main advantage of trading using opposite SENECA FOODS-A and Tyson Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS-A position performs unexpectedly, Tyson Foods 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 Tyson Foods will offset losses from the drop in Tyson Foods' long position.| SENECA FOODS-A vs. Chunghwa Telecom Co | SENECA FOODS-A vs. ScanSource | SENECA FOODS-A vs. Coor Service Management | SENECA FOODS-A vs. Cogent Communications Holdings |
| Tyson Foods vs. Charoen Pokphand Foods | Tyson Foods vs. Superior Plus Corp | Tyson Foods vs. NMI Holdings | Tyson Foods vs. Origin Agritech |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |