Correlation Between Flowers Foods and Sow Good

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

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

Diversification Opportunities for Flowers Foods and Sow Good

-0.36

Correlation Coefficient

Flowers Foods  Sow Good

Very good diversification

The 3 months correlation between Flowers and Sow is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Flowers Foods and Sow Good Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sow Good Common and Flowers 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 Flowers Foods are associated (or correlated) with Sow Good. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sow Good Common has no effect on the direction of Flowers Foods i.e., Flowers Foods and Sow Good go up and down completely randomly.

Pair Corralation between Flowers Foods and Sow Good

Considering the 90-day investment horizon Flowers Foods is expected to under-perform the Sow Good. But the stock apears to be less risky and, when comparing its historical volatility, Flowers Foods is 7.56 times less risky than Sow Good. The stock trades about -0.06 of its potential returns per unit of risk. The Sow Good Common is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  62.00  in Sow Good Common on May 7, 2025 and sell it today you would earn a total of  28.00  from holding Sow Good Common or generate 45.16% return on investment over 90 days.

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

Flowers Foods  vs.  Sow Good Common

Flowers Foods

Risk-Adjusted Performance

Very Weak

Over the last 90 days Flowers Foods has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy essential indicators, Flowers Foods is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Sow Good Common

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sow Good Common are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Sow Good reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Flowers Foods and Sow Good

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

The idea behind Flowers Foods and Sow Good 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.

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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 Commodity Directory module to find actively traded commodities issued by global exchanges.