Correlation Between Intrepid Potash and Scotts Miracle

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

By analyzing existing cross correlation between Intrepid Potash and Scotts Miracle Gro, you can compare the effects of market volatilities on Intrepid Potash and Scotts Miracle 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 Intrepid Potash with a short position of Scotts Miracle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intrepid Potash and Scotts Miracle.

Diversification Opportunities for Intrepid Potash and Scotts Miracle

0.5

Correlation Coefficient

Intrepid Potash  Scotts Miracle

Very weak diversification

The 3 months correlation between Intrepid and Scotts is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Intrepid Potash and Scotts Miracle Gro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scotts Miracle Gro and Intrepid Potash 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 Intrepid Potash are associated (or correlated) with Scotts Miracle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scotts Miracle Gro has no effect on the direction of Intrepid Potash i.e., Intrepid Potash and Scotts Miracle go up and down completely randomly.

Pair Corralation between Intrepid Potash and Scotts Miracle

Considering the 90-day investment horizon Intrepid Potash is expected to under-perform the Scotts Miracle. In addition to that, Intrepid Potash is 1.41 times more volatile than Scotts Miracle Gro. It trades about -0.15 of its total potential returns per unit of risk. Scotts Miracle Gro is currently generating about -0.15 per unit of volatility. If you would invest  6,764  in Scotts Miracle Gro on July 24, 2025 and sell it today you would lose (1,272) from holding Scotts Miracle Gro or give up 18.81% of portfolio value over 90 days.

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

Intrepid Potash  vs.  Scotts Miracle Gro

Intrepid Potash

Risk-Adjusted Performance

Weakest

Over the last 90 days Intrepid Potash has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in November 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Scotts Miracle Gro

Risk-Adjusted Performance

Weakest

Over the last 90 days Scotts Miracle Gro has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's primary indicators remain nearly stable which may send shares a bit higher in November 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Intrepid Potash and Scotts Miracle

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

The idea behind Intrepid Potash and Scotts Miracle Gro 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.