Hershey Stock Volatility

HSY -  USA Stock  

USD 194.37  0.24  0.12%

We consider Hershey Foods very steady. Hershey Foods Corp holds Efficiency (Sharpe) Ratio of 0.2, which attests that the entity had 0.2% of return per unit of risk over the last 3 months. Our standpoint towards determining the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for Hershey Foods Corp, which you can use to evaluate the future volatility of the firm. Please check out Hershey Foods Downside Deviation of 0.9901, market risk adjusted performance of 0.3049, and Risk Adjusted Performance of 0.0974 to validate if the risk estimate we provide is consistent with the expected return of 0.18%.

Hershey Volatility 

 
Refresh
Hershey Foods Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Hershey daily returns, and it is calculated using variance and standard deviation. We also use Hershey's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Hershey Foods volatility.

360 Days Market Risk

Very steady

Chance of Distress

360 Days Economic Sensitivity

Slowly supersedes the market
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Hershey Foods can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Hershey Foods at lower prices. For example, an investor can purchase Hershey stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Hershey Foods' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Hershey Foods Market Sensitivity And Downside Risk

Hershey Foods' beta coefficient measures the volatility of Hershey stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Hershey stock's returns against your selected market. In other words, Hershey Foods's beta of 0.34 provides an investor with an approximation of how much risk Hershey Foods stock can potentially add to one of your existing portfolios.
Let's try to break down what Hershey's beta means in this case. As returns on the market increase, Hershey Foods returns are expected to increase less than the market. However, during the bear market, the loss on holding Hershey Foods will be expected to be smaller as well.
3 Months Beta |Analyze Hershey Foods Corp Demand Trend
Check current 90 days Hershey Foods correlation with market (DOW)

Hershey Beta

    
  0.34  
Hershey standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  0.88  
It is essential to understand the difference between upside risk (as represented by Hershey Foods's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Hershey Foods stock's daily returns or price. Since the actual investment returns on holding a position in Hershey Foods stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Hershey Foods.

Hershey Foods Implied Volatility

    
  22.85  
Hershey Foods' implied volatility exposes the market's sentiment of Hershey Foods Corp stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Hershey Foods' implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Hershey Foods stock will not fluctuate a lot when Hershey Foods' options are near their expiration.

Hershey Foods Corp Stock Volatility Analysis

Volatility refers to the frequency at which Hershey Foods stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Hershey Foods' price changes. Investors will then calculate the volatility of Hershey Foods' stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Hershey Foods' volatility:

Historical Volatility

This type of stock volatility measures Hershey Foods' fluctuations based on previous trends. It's commonly used to predict Hershey Foods' future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Hershey Foods' current market price. This means that the stock will return to its initially predicted market price.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Hershey Foods Corp Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input. View also all equity analysis or get more info about average price price transform indicator.

Hershey Foods Projected Return Density Against Market

Considering the 90-day investment horizon Hershey Foods has a beta of 0.3357 . This usually indicates as returns on the market go up, Hershey Foods average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Hershey Foods Corp will be expected to be much smaller as well.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Hershey Foods or Consumer Defensive sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Hershey Foods stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Hershey stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has an alpha of 0.1232, implying that it can generate a 0.12 percent excess return over DOW after adjusting for the inherited market risk (beta).
 Predicted Return Density 
      Returns 
Hershey Foods' volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how Hershey Foods stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Company's Stock Price Volatility?

Several factors can influence a company's stock volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Hershey Foods Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Hershey Foods or Consumer Defensive sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Hershey Foods stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Hershey stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Considering the 90-day investment horizon the coefficient of variation of Hershey Foods is 495.92. The daily returns are distributed with a variance of 0.78 and standard deviation of 0.88. The mean deviation of Hershey Foods Corp is currently at 0.7. For similar time horizon, the selected benchmark (DOW) has volatility of 0.83
α
Alpha over DOW
0.12
β
Beta against DOW0.34
σ
Overall volatility
0.88
Ir
Information ratio 0.18

Hershey Foods Stock Return Volatility

Hershey Foods historical daily return volatility represents how much Hershey Foods stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. The company has volatility of 0.8838% on return distribution over 90 days investment horizon. By contrast, DOW inherits 0.8429% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
      Timeline 

About Hershey Foods Volatility

Volatility is a rate at which the price of Hershey Foods or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Hershey Foods may increase or decrease. In other words, similar to Hershey's beta indicator, it measures the risk of Hershey Foods and helps estimate the fluctuations that may happen in a short period of time. So if prices of Hershey Foods fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for 2022
Market Capitalization36.5 B32.2 B
The Hershey Company, together with its subsidiaries, manufactures and sells confectionery products and pantry items. The company was founded in 1894 and is headquartered in Hershey, Pennsylvania. Hershey Foods operates under Confectioners classification in the United States and is traded on New York Stock Exchange. It employs 15200 people.

Nearest Hershey long CALL Option Payoff at Expiration

Hershey Foods' implied volatility is one of the determining factors in the pricing options written on Hershey Foods Corp. Implied volatility approximates the future value of Hershey Foodsusing the option's current value. Options with high implied volatility have higher premiums and can be used to hedge the downside of investing in Hershey Foods Corp over a specific time period.
View All Hershey options
2022-01-28 CALL at $135.0 is a CALL option contract on Hershey Foods' common stock with a strick price of 135.0 expiring on 2022-01-28. The contract was not traded in recent days and, as of today, has 1 days remaining before the expiration. The option is currently trading at a bid price of $57.5, and an ask price of $62.1. The implied volatility as of the 27th of January is 159.82.
 Profit 
Share
      Hershey Foods Price At Expiration 

Hershey Foods Investment Opportunity

Hershey Foods Corp has a volatility of 0.88 and is 1.05 times more volatile than DOW. of all equities and portfolios are less risky than Hershey Foods. Compared to the overall equity markets, volatility of historical daily returns of Hershey Foods Corp is lower than 7 () of all global equities and portfolios over the last 90 days. Use Hershey Foods Corp to enhance returns of your portfolios. The stock experiences a normal upward fluctuation. Check odds of Hershey Foods to be traded at $204.09 in 90 days. . Let's try to break down what Hershey's beta means in this case. As returns on the market increase, Hershey Foods returns are expected to increase less than the market. However, during the bear market, the loss on holding Hershey Foods will be expected to be smaller as well.

Weak diversification

The correlation between Hershey Foods Corp and DJI is Weak diversification for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Hershey Foods Corp and DJI in the same portfolio assuming nothing else is changed.

Hershey Foods Additional Risk Indicators

The analysis of Hershey Foods' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Hershey Foods' investment and either accepting that risk or mitigating it. Along with some common measures of Hershey Foods stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Risk Adjusted Performance0.0974
Market Risk Adjusted Performance0.3049
Mean Deviation0.749
Semi Deviation0.881
Downside Deviation0.9901
Coefficient Of Variation860.04
Standard Deviation0.9374
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Hershey Foods Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
GM vs. Hershey Foods
USA Quality vs. Hershey Foods
Visa vs. Hershey Foods
Ford vs. Hershey Foods
Dividend Appreciation vs. Hershey Foods
Sentinelone Inc vs. Hershey Foods
Du Pont vs. Hershey Foods
Alphabet vs. Hershey Foods
Microsoft Corp vs. Hershey Foods
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Hershey Foods as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Hershey Foods' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Hershey Foods' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Hershey Foods Corp.
Please check Risk vs Return Analysis. Note that the Hershey Foods Corp information on this page should be used as a complementary analysis to other Hershey Foods' statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.

Complementary Tools for Hershey Stock analysis

When running Hershey Foods Corp price analysis, check to measure Hershey Foods' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Hershey Foods is operating at the current time. Most of Hershey Foods' value examination focuses on studying past and present price action to predict the probability of Hershey Foods' future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Hershey Foods' price. Additionally, you may evaluate how the addition of Hershey Foods to your portfolios can decrease your overall portfolio volatility.
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
Go
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Go
Piotroski F Score
Get Piotroski F Score based on binary analysis strategy of nine different fundamentals
Go
Price Transformation
Use Price Transformation models to analyze depth of different equity instruments across global markets
Go
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Go
Is Hershey Foods' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Hershey Foods. If investors know Hershey will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Hershey Foods listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of Hershey Foods Corp is measured differently than its book value, which is the value of Hershey that is recorded on the company's balance sheet. Investors also form their own opinion of Hershey Foods' value that differs from its market value or its book value, called intrinsic value, which is Hershey Foods' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Hershey Foods' market value can be influenced by many factors that don't directly affect Hershey Foods' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Hershey Foods' value and its price as these two are different measures arrived at by different means. Investors typically determine Hershey Foods value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Hershey Foods' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.