Correlation Between Smart For and ConAgra Foods

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

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

Diversification Opportunities for Smart For and ConAgra Foods

0.0

Correlation Coefficient

Smart For  ConAgra Foods

Pay attention - limited upside

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

Pair Corralation between Smart For and ConAgra Foods

If you would invest (100.00) in Smart for Life, on December 28, 2024 and sell it today you would earn a total of  100.00  from holding Smart for Life, 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

Smart for Life,  vs.  ConAgra Foods

Smart for Life,

Risk-Adjusted Performance

Very Weak

Over the last 90 days Smart for Life, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Smart For is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

ConAgra Foods

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Smart For and ConAgra Foods

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

The idea behind Smart for Life, and ConAgra Foods 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.

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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.