Correlation Between Clorox and Smithfield Foods,

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

By analyzing existing cross correlation between The Clorox and Smithfield Foods, Common, you can compare the effects of market volatilities on Clorox and Smithfield Foods, 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 Clorox with a short position of Smithfield Foods,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clorox and Smithfield Foods,.

Diversification Opportunities for Clorox and Smithfield Foods,

-0.67

Correlation Coefficient

Clorox  Smithfield Foods,

Excellent diversification

The 3 months correlation between Clorox and Smithfield is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding The Clorox and Smithfield Foods, Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smithfield Foods, Common and Clorox 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 The Clorox are associated (or correlated) with Smithfield Foods,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smithfield Foods, Common has no effect on the direction of Clorox i.e., Clorox and Smithfield Foods, go up and down completely randomly.

Pair Corralation between Clorox and Smithfield Foods,

Considering the 90-day investment horizon The Clorox is expected to under-perform the Smithfield Foods,. In addition to that, Clorox is 1.18 times more volatile than Smithfield Foods, Common. It trades about -0.1 of its total potential returns per unit of risk. Smithfield Foods, Common is currently generating about 0.15 per unit of volatility. If you would invest  2,202  in Smithfield Foods, Common on May 6, 2025 and sell it today you would earn a total of  230.00  from holding Smithfield Foods, Common or generate 10.45% return on investment over 90 days.

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

The Clorox  vs.  Smithfield Foods, Common

Clorox

Risk-Adjusted Performance

Very Weak

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

Smithfield Foods, Common

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Smithfield Foods, Common are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Smithfield Foods, may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Clorox and Smithfield Foods,

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

The idea behind The Clorox and Smithfield Foods, Common 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.