Correlation Between Maple Leaf and United Natural

Can any of the company-specific risk be diversified away by investing in both Maple Leaf and United Natural 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 Maple Leaf and United Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Maple Leaf Foods and United Natural Foods, you can compare the effects of market volatilities on Maple Leaf and United Natural 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 Maple Leaf with a short position of United Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maple Leaf and United Natural.

Diversification Opportunities for Maple Leaf and United Natural

-0.3

Correlation Coefficient

Maple Leaf  United Natural

Very good diversification

The 3 months correlation between Maple and United is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Maple Leaf Foods and United Natural Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Natural Foods and Maple Leaf 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 Maple Leaf Foods are associated (or correlated) with United Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Natural Foods has no effect on the direction of Maple Leaf i.e., Maple Leaf and United Natural go up and down completely randomly.

Pair Corralation between Maple Leaf and United Natural

Assuming the 90 days trading horizon Maple Leaf Foods is expected to generate 0.38 times more return on investment than United Natural. However, Maple Leaf Foods is 2.62 times less risky than United Natural. It trades about 0.18 of its potential returns per unit of risk. United Natural Foods is currently generating about 0.04 per unit of risk. If you would invest  1,566  in Maple Leaf Foods on April 23, 2025 and sell it today you would earn a total of  304.00  from holding Maple Leaf Foods or generate 19.41% return on investment over 90 days.

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

Maple Leaf Foods  vs.  United Natural Foods

Maple Leaf Foods

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Maple Leaf Foods are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Maple Leaf unveiled solid returns over the last few months and may actually be approaching a breakup point.

United Natural Foods

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in United Natural Foods are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, United Natural may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Maple Leaf and United Natural

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

The idea behind Maple Leaf Foods and United Natural Foods 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.