Correlation Between ConAgra Foods and JM Smucker
Can any of the company-specific risk be diversified away by investing in both ConAgra Foods and JM Smucker 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 ConAgra Foods and JM Smucker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ConAgra Foods and JM Smucker, you can compare the effects of market volatilities on ConAgra Foods and JM Smucker 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 ConAgra Foods with a short position of JM Smucker. Check out your portfolio center. Please also check ongoing floating volatility patterns of ConAgra Foods and JM Smucker.
Diversification Opportunities for ConAgra Foods and JM Smucker
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ConAgra and SJM is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding ConAgra Foods and JM Smucker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JM Smucker and ConAgra Foods 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 ConAgra Foods are associated (or correlated) with JM Smucker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JM Smucker has no effect on the direction of ConAgra Foods i.e., ConAgra Foods and JM Smucker go up and down completely randomly.
Pair Corralation between ConAgra Foods and JM Smucker
Considering the 90-day investment horizon ConAgra Foods is expected to generate 0.99 times more return on investment than JM Smucker. However, ConAgra Foods is 1.01 times less risky than JM Smucker. It trades about 0.0 of its potential returns per unit of risk. JM Smucker is currently generating about -0.01 per unit of risk. If you would invest 3,185 in ConAgra Foods on January 21, 2024 and sell it today you would lose (123.00) from holding ConAgra Foods or give up 3.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
ConAgra Foods vs. JM Smucker
Performance |
| Timeline |
| ConAgra Foods |
| JM Smucker |
ConAgra Foods and JM Smucker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ConAgra Foods and JM Smucker
The main advantage of trading using opposite ConAgra Foods and JM Smucker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ConAgra Foods position performs unexpectedly, JM Smucker 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 JM Smucker will offset losses from the drop in JM Smucker's long position.| ConAgra Foods vs. Green Globe International | ConAgra Foods vs. Greenlane Holdings | ConAgra Foods vs. 22nd Century Group | ConAgra Foods vs. 1606 Corp |
| JM Smucker vs. Green Globe International | JM Smucker vs. Greenlane Holdings | JM Smucker vs. 22nd Century Group | JM Smucker vs. 1606 Corp |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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