Correlation Between Smart For and Calbee

Can any of the company-specific risk be diversified away by investing in both Smart For and Calbee 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 Calbee 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 Calbee Inc, you can compare the effects of market volatilities on Smart For and Calbee 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 Calbee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smart For and Calbee.

Diversification Opportunities for Smart For and Calbee

0.0

Correlation Coefficient

Smart For  Calbee

Pay attention - limited upside

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

Pair Corralation between Smart For and Calbee

If you would invest (100.00) in Smart for Life, on December 1, 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.  Calbee Inc

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.

Calbee Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Calbee Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Smart For and Calbee

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

The idea behind Smart for Life, and Calbee Inc 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.