Correlation Between Weiss Korea and Bell Food

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

By analyzing existing cross correlation between Weiss Korea Opportunity and Bell Food Group, you can compare the effects of market volatilities on Weiss Korea and Bell 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 Weiss Korea with a short position of Bell Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weiss Korea and Bell Food.

Diversification Opportunities for Weiss Korea and Bell Food

0.16

Correlation Coefficient

Weiss Korea  Bell Food

Average diversification

The 3 months correlation between Weiss and Bell is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Weiss Korea Opportunity and Bell Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bell Food Group and Weiss Korea 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 Weiss Korea Opportunity are associated (or correlated) with Bell Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bell Food Group has no effect on the direction of Weiss Korea i.e., Weiss Korea and Bell Food go up and down completely randomly.

Pair Corralation between Weiss Korea and Bell Food

Assuming the 90 days trading horizon Weiss Korea is expected to generate 1.38 times less return on investment than Bell Food. In addition to that, Weiss Korea is 4.06 times more volatile than Bell Food Group. It trades about 0.0 of its total potential returns per unit of risk. Bell Food Group is currently generating about 0.02 per unit of volatility. If you would invest  26,400  in Bell Food Group on October 6, 2024 and sell it today you would earn a total of  150.00  from holding Bell Food Group or generate 0.57% return on investment over 90 days.

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

Weiss Korea Opportunity  vs.  Bell Food Group

Weiss Korea Opportunity

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Weiss Korea Opportunity has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Weiss Korea is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Bell Food Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bell Food Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Bell Food is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Weiss Korea and Bell Food

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

The idea behind Weiss Korea Opportunity and Bell Food Group 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.