Correlation Between BG Foods and FEIHE INTERNATIONAL

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Can any of the company-specific risk be diversified away by investing in both BG Foods and FEIHE INTERNATIONAL 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 BG Foods and FEIHE INTERNATIONAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BG Foods Holdings and FEIHE INTERNATIONAL INC, you can compare the effects of market volatilities on BG Foods and FEIHE INTERNATIONAL 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 BG Foods with a short position of FEIHE INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of BG Foods and FEIHE INTERNATIONAL.

Diversification Opportunities for BG Foods and FEIHE INTERNATIONAL

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between BG Foods and FEIHE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BG Foods Holdings and FEIHE INTERNATIONAL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FEIHE INTERNATIONAL INC and BG 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 BG Foods Holdings are associated (or correlated) with FEIHE INTERNATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FEIHE INTERNATIONAL INC has no effect on the direction of BG Foods i.e., BG Foods and FEIHE INTERNATIONAL go up and down completely randomly.

Pair Corralation between BG Foods and FEIHE INTERNATIONAL

If you would invest  2,499  in BG Foods Holdings on May 20, 2022 and sell it today you would lose (114.00)  from holding BG Foods Holdings or give up 4.56% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

BG Foods Holdings  vs.  FEIHE INTERNATIONAL INC

 Performance (%) 
       Timeline  
BG Foods Holdings 
BG Foods Performance
7 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in BG Foods Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak technical and fundamental indicators, BG Foods reported solid returns over the last few months and may actually be approaching a breakup point.

BG Foods Price Channel

FEIHE INTERNATIONAL INC 
FEIHE Performance
0 of 100
Over the last 90 days FEIHE INTERNATIONAL INC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental indicators, FEIHE INTERNATIONAL is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

BG Foods and FEIHE INTERNATIONAL Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with BG Foods and FEIHE INTERNATIONAL

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

BG Foods Holdings

Pair trading matchups for BG Foods

The idea behind BG Foods Holdings and FEIHE INTERNATIONAL INC 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.

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