Correlation Between Clover Health and Beyond Meat

Can any of the company-specific risk be diversified away by investing in both Clover Health and Beyond Meat 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 Clover Health and Beyond Meat into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Clover Health Investments, and Beyond Meat, you can compare the effects of market volatilities on Clover Health and Beyond Meat 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 Clover Health with a short position of Beyond Meat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clover Health and Beyond Meat.

Diversification Opportunities for Clover Health and Beyond Meat

-0.78

Correlation Coefficient

Clover Health  Beyond Meat

Pay attention - limited upside

The 3 months correlation between Clover and Beyond is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Clover Health Investments, and Beyond Meat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Meat and Clover Health 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 Clover Health Investments, are associated (or correlated) with Beyond Meat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond Meat has no effect on the direction of Clover Health i.e., Clover Health and Beyond Meat go up and down completely randomly.

Pair Corralation between Clover Health and Beyond Meat

Assuming the 90 days trading horizon Clover Health Investments, is expected to under-perform the Beyond Meat. In addition to that, Clover Health is 1.32 times more volatile than Beyond Meat. It trades about -0.02 of its total potential returns per unit of risk. Beyond Meat is currently generating about 0.12 per unit of volatility. If you would invest  76.00  in Beyond Meat on April 20, 2025 and sell it today you would earn a total of  21.00  from holding Beyond Meat or generate 27.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Clover Health Investments,  vs.  Beyond Meat

Clover Health Invest

Risk-Adjusted Performance

Very Weak

Over the last 90 days Clover Health Investments, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Clover Health is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Beyond Meat

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Beyond Meat are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Beyond Meat sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Clover Health and Beyond Meat

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

The idea behind Clover Health Investments, and Beyond Meat 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.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.