Correlation Between SENECA FOODS-A and CLEAN ENERGY
Can any of the company-specific risk be diversified away by investing in both SENECA FOODS-A and CLEAN ENERGY 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 CLEAN ENERGY 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 CLEAN ENERGY FUELS, you can compare the effects of market volatilities on SENECA FOODS-A and CLEAN ENERGY 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 CLEAN ENERGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of SENECA FOODS-A and CLEAN ENERGY.
Diversification Opportunities for SENECA FOODS-A and CLEAN ENERGY
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between SENECA and CLEAN is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding SENECA FOODS A and CLEAN ENERGY FUELS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CLEAN ENERGY FUELS 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 CLEAN ENERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CLEAN ENERGY FUELS has no effect on the direction of SENECA FOODS-A i.e., SENECA FOODS-A and CLEAN ENERGY go up and down completely randomly.
Pair Corralation between SENECA FOODS-A and CLEAN ENERGY
Assuming the 90 days trading horizon SENECA FOODS A is expected to generate 0.87 times more return on investment than CLEAN ENERGY. However, SENECA FOODS A is 1.15 times less risky than CLEAN ENERGY. It trades about 0.03 of its potential returns per unit of risk. CLEAN ENERGY FUELS is currently generating about -0.01 per unit of risk. If you would invest 5,400 in SENECA FOODS A on October 12, 2024 and sell it today you would earn a total of 1,650 from holding SENECA FOODS A or generate 30.56% 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. CLEAN ENERGY FUELS
Performance |
| Timeline |
| SENECA FOODS A |
| CLEAN ENERGY FUELS |
SENECA FOODS-A and CLEAN ENERGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SENECA FOODS-A and CLEAN ENERGY
The main advantage of trading using opposite SENECA FOODS-A and CLEAN ENERGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SENECA FOODS-A position performs unexpectedly, CLEAN ENERGY 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 CLEAN ENERGY will offset losses from the drop in CLEAN ENERGY's long position.| SENECA FOODS-A vs. ELECTRONIC ARTS | SENECA FOODS-A vs. Renesas Electronics | SENECA FOODS-A vs. CARSALESCOM | SENECA FOODS-A vs. MOVIE GAMES SA |
| CLEAN ENERGY vs. SENECA FOODS A | CLEAN ENERGY vs. MeVis Medical Solutions | CLEAN ENERGY vs. SPECTRAL MEDICAL | CLEAN ENERGY vs. Advanced Medical Solutions |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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