Correlation Between Hormel Foods and Akamai Technologies

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Hormel Foods and Akamai Technologies 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 Hormel Foods and Akamai Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hormel Foods and Akamai Technologies, you can compare the effects of market volatilities on Hormel Foods and Akamai Technologies 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 Hormel Foods with a short position of Akamai Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hormel Foods and Akamai Technologies.

Diversification Opportunities for Hormel Foods and Akamai Technologies

  Correlation Coefficient

Poor diversification

The 3 months correlation between Hormel and Akamai is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Hormel Foods and Akamai Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akamai Technologies and Hormel 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 Hormel Foods are associated (or correlated) with Akamai Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akamai Technologies has no effect on the direction of Hormel Foods i.e., Hormel Foods and Akamai Technologies go up and down completely randomly.

Pair Corralation between Hormel Foods and Akamai Technologies

Considering the 90-day investment horizon Hormel Foods is expected to generate 3.31 times less return on investment than Akamai Technologies. But when comparing it to its historical volatility, Hormel Foods is 1.83 times less risky than Akamai Technologies. It trades about 0.12 of its potential returns per unit of risk. Akamai Technologies is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  8,541  in Akamai Technologies on September 3, 2022 and sell it today you would earn a total of  838.00  from holding Akamai Technologies or generate 9.81% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
ValuesDaily Returns

Hormel Foods  vs.  Akamai Technologies

 Performance (%) 
Hormel Foods 
Hormel Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Hormel Foods are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively steady basic indicators, Hormel Foods is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

Hormel Price Channel

Akamai Technologies 
Akamai Performance
4 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Akamai Technologies are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Akamai Technologies may actually be approaching a critical reversion point that can send shares even higher in January 2023.

Akamai Price Channel

Hormel Foods and Akamai Technologies Volatility Contrast

   Predicted Return Density   

Pair Trading with Hormel Foods and Akamai Technologies

The main advantage of trading using opposite Hormel Foods and Akamai Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hormel Foods position performs unexpectedly, Akamai Technologies 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 Akamai Technologies will offset losses from the drop in Akamai Technologies' long position.
Hormel Foods vs. Anheuser Busch Inbev
Hormel Foods vs. Etsy Inc
Hormel Foods vs. Anheuser-Busch InBev SANV
Hormel Foods vs. Linde PLC
The idea behind Hormel Foods and Akamai Technologies 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.
Akamai Technologies vs. Anheuser Busch Inbev
Akamai Technologies vs. Etsy Inc
Akamai Technologies vs. JPMorgan Chase Co
Akamai Technologies vs. Linde PLC
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.

Other Complementary Tools

Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Equity Valuation
Check real value of public entities based on technical and fundamental data
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Commodity Channel Index
Use Commodity Channel Index to analyze current equity momentum
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings