Correlation Between Edible Garden and Forafric Global

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

By analyzing existing cross correlation between Edible Garden AG and Forafric Global PLC, you can compare the effects of market volatilities on Edible Garden and Forafric Global 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 Edible Garden with a short position of Forafric Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edible Garden and Forafric Global.

Diversification Opportunities for Edible Garden and Forafric Global

-0.6

Correlation Coefficient

Edible Garden  Forafric Global

Excellent diversification

The 3 months correlation between Edible and Forafric is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Edible Garden AG and Forafric Global PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forafric Global PLC and Edible Garden 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 Edible Garden AG are associated (or correlated) with Forafric Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forafric Global PLC has no effect on the direction of Edible Garden i.e., Edible Garden and Forafric Global go up and down completely randomly.

Pair Corralation between Edible Garden and Forafric Global

Given the investment horizon of 90 days Edible Garden AG is expected to generate 1.11 times more return on investment than Forafric Global. However, Edible Garden is 1.11 times more volatile than Forafric Global PLC. It trades about 0.08 of its potential returns per unit of risk. Forafric Global PLC is currently generating about 0.07 per unit of risk. If you would invest  192.00  in Edible Garden AG on May 5, 2025 and sell it today you would earn a total of  48.00  from holding Edible Garden AG or generate 25.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	84.13%
Values	Daily Returns

Edible Garden AG  vs.  Forafric Global PLC

Edible Garden AG

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Edible Garden AG are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental drivers, Edible Garden disclosed solid returns over the last few months and may actually be approaching a breakup point.

Forafric Global PLC

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Forafric Global PLC are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal forward indicators, Forafric Global showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Edible Garden and Forafric Global

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

The idea behind Edible Garden AG and Forafric Global PLC 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.