Correlation Between Blender Financial and Millennium Food

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

By analyzing existing cross correlation between Blender Financial Technologies and Millennium Food Tech LP, you can compare the effects of market volatilities on Blender Financial and Millennium Food 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 Blender Financial with a short position of Millennium Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blender Financial and Millennium Food.

Diversification Opportunities for Blender Financial and Millennium Food

0.44

Correlation Coefficient

Blender Financial  Millennium Food

Very weak diversification

The 3 months correlation between Blender and Millennium is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Blender Financial Technologies and Millennium Food Tech LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Millennium Food Tech and Blender Financial 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 Blender Financial Technologies are associated (or correlated) with Millennium Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Millennium Food Tech has no effect on the direction of Blender Financial i.e., Blender Financial and Millennium Food go up and down completely randomly.

Pair Corralation between Blender Financial and Millennium Food

Assuming the 90 days trading horizon Blender Financial Technologies is expected to under-perform the Millennium Food. In addition to that, Blender Financial is 1.36 times more volatile than Millennium Food Tech LP. It trades about -0.05 of its total potential returns per unit of risk. Millennium Food Tech LP is currently generating about 0.04 per unit of volatility. If you would invest  19,530  in Millennium Food Tech LP on September 29, 2024 and sell it today you would earn a total of  690.00  from holding Millennium Food Tech LP or generate 3.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	97.87%
Values	Daily Returns

Blender Financial Technologies  vs.  Millennium Food Tech LP

Blender Financial

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blender Financial Technologies 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 somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Millennium Food Tech

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Millennium Food Tech LP are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Millennium Food may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Blender Financial and Millennium Food

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

The idea behind Blender Financial Technologies and Millennium Food Tech LP 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.