Correlation Between MamaMancinis Holdings and McCormick Company
Can any of the company-specific risk be diversified away by investing in both MamaMancinis Holdings and McCormick Company 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 MamaMancinis Holdings and McCormick Company into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MamaMancinis Holdings and McCormick Company Incorporated, you can compare the effects of market volatilities on MamaMancinis Holdings and McCormick Company 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 MamaMancinis Holdings with a short position of McCormick Company. Check out your portfolio center. Please also check ongoing floating volatility patterns of MamaMancinis Holdings and McCormick Company.
Diversification Opportunities for MamaMancinis Holdings and McCormick Company
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MamaMancinis and McCormick is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding MamaMancinis Holdings and McCormick Company Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on McCormick Company and MamaMancinis Holdings 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 MamaMancinis Holdings are associated (or correlated) with McCormick Company. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of McCormick Company has no effect on the direction of MamaMancinis Holdings i.e., MamaMancinis Holdings and McCormick Company go up and down completely randomly.
Pair Corralation between MamaMancinis Holdings and McCormick Company
If you would invest 369.00 in MamaMancinis Holdings on September 14, 2024 and sell it today you would earn a total of 0.00 from holding MamaMancinis Holdings or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 1.59% |
Values | Daily Returns |
MamaMancinis Holdings vs. McCormick Company Incorporated
Performance |
Timeline |
MamaMancinis Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
McCormick Company |
MamaMancinis Holdings and McCormick Company Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MamaMancinis Holdings and McCormick Company
The main advantage of trading using opposite MamaMancinis Holdings and McCormick Company positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MamaMancinis Holdings position performs unexpectedly, McCormick Company 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 McCormick Company will offset losses from the drop in McCormick Company's long position.MamaMancinis Holdings vs. Seneca Foods Corp | MamaMancinis Holdings vs. Central Garden Pet | MamaMancinis Holdings vs. Central Garden Pet | MamaMancinis Holdings vs. Natures Sunshine Products |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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