Correlation Between ASSOC BR and GURU ORGANIC

Can any of the company-specific risk be diversified away by investing in both ASSOC BR and GURU ORGANIC 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 ASSOC BR and GURU ORGANIC into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ASSOC BR FOODS and GURU ORGANIC ENERGY, you can compare the effects of market volatilities on ASSOC BR and GURU ORGANIC 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 ASSOC BR with a short position of GURU ORGANIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASSOC BR and GURU ORGANIC.

Diversification Opportunities for ASSOC BR and GURU ORGANIC

0.13

Correlation Coefficient

ASSOC BR  GURU ORGANIC

Average diversification

The 3 months correlation between ASSOC and GURU is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding ASSOC BR FOODS and GURU ORGANIC ENERGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GURU ORGANIC ENERGY and ASSOC BR 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 ASSOC BR FOODS are associated (or correlated) with GURU ORGANIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GURU ORGANIC ENERGY has no effect on the direction of ASSOC BR i.e., ASSOC BR and GURU ORGANIC go up and down completely randomly.

Pair Corralation between ASSOC BR and GURU ORGANIC

Assuming the 90 days trading horizon ASSOC BR FOODS is expected to under-perform the GURU ORGANIC. But the stock apears to be less risky and, when comparing its historical volatility, ASSOC BR FOODS is 2.36 times less risky than GURU ORGANIC. The stock trades about -0.02 of its potential returns per unit of risk. The GURU ORGANIC ENERGY is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  118.00  in GURU ORGANIC ENERGY on March 3, 2025 and sell it today you would lose (8.00) from holding GURU ORGANIC ENERGY or give up 6.78% of portfolio value over 90 days.

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

ASSOC BR FOODS  vs.  GURU ORGANIC ENERGY

ASSOC BR FOODS

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ASSOC BR FOODS are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ASSOC BR may actually be approaching a critical reversion point that can send shares even higher in July 2025.

GURU ORGANIC ENERGY

Risk-Adjusted Performance

Weak

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

Pair Trading with ASSOC BR and GURU ORGANIC

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

The idea behind ASSOC BR FOODS and GURU ORGANIC ENERGY 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 CEOs Directory module to screen CEOs from public companies around the world.