Correlation Between Foodnamoo and FoodNamoo

Can any of the company-specific risk be diversified away by investing in both Foodnamoo and FoodNamoo 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 Foodnamoo and FoodNamoo into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Foodnamoo and FoodNamoo, you can compare the effects of market volatilities on Foodnamoo and FoodNamoo 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 Foodnamoo with a short position of FoodNamoo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foodnamoo and FoodNamoo.

Diversification Opportunities for Foodnamoo and FoodNamoo

1.0

Correlation Coefficient

Foodnamoo  FoodNamoo

No risk reduction

The 3 months correlation between Foodnamoo and FoodNamoo is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Foodnamoo and FoodNamoo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FoodNamoo and Foodnamoo 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 Foodnamoo are associated (or correlated) with FoodNamoo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FoodNamoo has no effect on the direction of Foodnamoo i.e., Foodnamoo and FoodNamoo go up and down completely randomly.

Pair Corralation between Foodnamoo and FoodNamoo

Assuming the 90 days trading horizon If you would invest  304,000  in FoodNamoo on November 29, 2024 and sell it today you would lose (41,500) from holding FoodNamoo or give up 13.65% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Foodnamoo  vs.  FoodNamoo

Foodnamoo

Risk-Adjusted Performance

Very Weak

Over the last 90 days Foodnamoo has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

FoodNamoo

Risk-Adjusted Performance

Very Weak

Over the last 90 days FoodNamoo has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Foodnamoo and FoodNamoo

The main advantage of trading using opposite Foodnamoo and FoodNamoo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Foodnamoo position performs unexpectedly, FoodNamoo 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 FoodNamoo will offset losses from the drop in FoodNamoo's long position.

The idea behind Foodnamoo and FoodNamoo pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.