Correlation Between VegTech Plant and YUMY

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

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

Diversification Opportunities for VegTech Plant and YUMY

-0.29

Correlation Coefficient

VegTech Plant  YUMY

Very good diversification

The 3 months correlation between VegTech and YUMY is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding VegTech Plant based Innovation and YUMY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YUMY and VegTech Plant 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 VegTech Plant based Innovation are associated (or correlated) with YUMY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YUMY has no effect on the direction of VegTech Plant i.e., VegTech Plant and YUMY go up and down completely randomly.

Pair Corralation between VegTech Plant and YUMY

If you would invest  1,778  in YUMY on October 27, 2024 and sell it today you would earn a total of  0.00  from holding YUMY or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.26%
Values	Daily Returns

VegTech Plant based Innovation  vs.  YUMY

VegTech Plant based

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VegTech Plant based Innovation has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, VegTech Plant is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

YUMY

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days YUMY has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong primary indicators, YUMY is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with VegTech Plant and YUMY

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

The idea behind VegTech Plant based Innovation and YUMY 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.