Correlation Between Boosh Plant and Nates Food

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

By analyzing existing cross correlation between Boosh Plant Based Brands and Nates Food Co, you can compare the effects of market volatilities on Boosh Plant and Nates Food 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 Boosh Plant with a short position of Nates Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boosh Plant and Nates Food.

Diversification Opportunities for Boosh Plant and Nates Food

0.0

Correlation Coefficient

Boosh Plant  Nates Food

Pay attention - limited upside

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

Pair Corralation between Boosh Plant and Nates Food

If you would invest  0.20  in Boosh Plant Based Brands on October 5, 2024 and sell it today you would earn a total of  0.15  from holding Boosh Plant Based Brands or generate 75.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Boosh Plant Based Brands  vs.  Nates Food Co

Boosh Plant Based

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Boosh Plant Based Brands are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward indicators, Boosh Plant reported solid returns over the last few months and may actually be approaching a breakup point.

Nates Food

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nates Food Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, Nates Food is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Boosh Plant and Nates Food

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

The idea behind Boosh Plant Based Brands and Nates Food Co 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.