Correlation Between Graco and Natures Miracle

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

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

Diversification Opportunities for Graco and Natures Miracle

0.0

Correlation Coefficient

Graco  Natures Miracle

Pay attention - limited upside

The 3 months correlation between Graco and Natures is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Graco Inc and Natures Miracle Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natures Miracle Holding and Graco 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 Graco Inc are associated (or correlated) with Natures Miracle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natures Miracle Holding has no effect on the direction of Graco i.e., Graco and Natures Miracle go up and down completely randomly.

Pair Corralation between Graco and Natures Miracle

If you would invest (100.00) in Natures Miracle Holding on December 19, 2024 and sell it today you would earn a total of  100.00  from holding Natures Miracle Holding or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Graco Inc  vs.  Natures Miracle Holding

Graco Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Graco Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Graco is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Natures Miracle Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Natures Miracle Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, Natures Miracle is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Graco and Natures Miracle

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

The idea behind Graco Inc and Natures Miracle Holding 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.