Correlation Between Else Nutrition and Laird Superfood

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

By analyzing existing cross correlation between Else Nutrition Holdings and Laird Superfood, you can compare the effects of market volatilities on Else Nutrition and Laird Superfood 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 Else Nutrition with a short position of Laird Superfood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Else Nutrition and Laird Superfood.

Diversification Opportunities for Else Nutrition and Laird Superfood

-0.59

Correlation Coefficient

Else Nutrition  Laird Superfood

Excellent diversification

The 3 months correlation between Else and Laird is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Else Nutrition Holdings and Laird Superfood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Laird Superfood and Else Nutrition 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 Else Nutrition Holdings are associated (or correlated) with Laird Superfood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Laird Superfood has no effect on the direction of Else Nutrition i.e., Else Nutrition and Laird Superfood go up and down completely randomly.

Pair Corralation between Else Nutrition and Laird Superfood

Assuming the 90 days horizon Else Nutrition Holdings is expected to under-perform the Laird Superfood. In addition to that, Else Nutrition is 1.43 times more volatile than Laird Superfood. It trades about -0.08 of its total potential returns per unit of risk. Laird Superfood is currently generating about 0.23 per unit of volatility. If you would invest  367.00  in Laird Superfood on September 14, 2024 and sell it today you would earn a total of  469.00  from holding Laird Superfood or generate 127.79% return on investment over 90 days.

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

Else Nutrition Holdings  vs.  Laird Superfood

Else Nutrition Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Laird Superfood

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Laird Superfood are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Laird Superfood reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Else Nutrition and Laird Superfood

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

The idea behind Else Nutrition Holdings and Laird Superfood 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.