Correlation Between Conagra Brands and IQ Hedge

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

Diversification Opportunities for Conagra Brands and IQ Hedge

-0.09
  Correlation Coefficient

Good diversification

The 3 months correlation between Conagra and IQ Hedge is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Conagra Brands and IQ Hedge Multi-Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQ Hedge Multi-Strategy and Conagra Brands 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 Conagra Brands are associated (or correlated) with IQ Hedge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQ Hedge Multi-Strategy has no effect on the direction of Conagra Brands i.e., Conagra Brands and IQ Hedge go up and down completely randomly.

Pair Corralation between Conagra Brands and IQ Hedge

Considering the 90-day investment horizon Conagra Brands is expected to under-perform the IQ Hedge. In addition to that, Conagra Brands is 3.4 times more volatile than IQ Hedge Multi-Strategy. It trades about -0.01 of its total potential returns per unit of risk. IQ Hedge Multi-Strategy is currently generating about 0.05 per unit of volatility. If you would invest  2,920  in IQ Hedge Multi-Strategy on May 15, 2022 and sell it today you would earn a total of  50.00  from holding IQ Hedge Multi-Strategy or generate 1.71% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Conagra Brands  vs.  IQ Hedge Multi-Strategy

 Performance (%) 
       Timeline  
Conagra Brands 
Conagra Performance
0 of 100
Over the last 90 days Conagra Brands has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Conagra Brands is not utilizing all of its potentials. The new stock price tumult, may contribute to shorter-term losses for the shareholders.

Conagra Price Channel

IQ Hedge Multi-Strategy 
IQ Hedge Performance
4 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in IQ Hedge Multi-Strategy are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, IQ Hedge is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

IQ Hedge Price Channel

Conagra Brands and IQ Hedge Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Conagra Brands and IQ Hedge

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

Conagra Brands

Pair trading matchups for Conagra Brands

The idea behind Conagra Brands and IQ Hedge Multi-Strategy 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.

IQ Hedge Multi-Strategy

Pair trading matchups for IQ Hedge

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 Stock Screener module to find equities using custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

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