Correlation Between RB FOOD and Information

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

By analyzing existing cross correlation between RB FOOD SUPPLY and Information and Communication, you can compare the effects of market volatilities on RB FOOD and Information 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 RB FOOD with a short position of Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of RB FOOD and Information.

Diversification Opportunities for RB FOOD and Information

0.49

Correlation Coefficient

RB FOOD  Information

Very weak diversification

The 3 months correlation between RBF-R and Information is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding RB FOOD SUPPLY and Information and Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Information and Comm and RB FOOD 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 RB FOOD SUPPLY are associated (or correlated) with Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Information and Comm has no effect on the direction of RB FOOD i.e., RB FOOD and Information go up and down completely randomly.

Pair Corralation between RB FOOD and Information

Assuming the 90 days trading horizon RB FOOD SUPPLY is expected to under-perform the Information. In addition to that, RB FOOD is 3.78 times more volatile than Information and Communication. It trades about -0.05 of its total potential returns per unit of risk. Information and Communication is currently generating about 0.09 per unit of volatility. If you would invest  176.00  in Information and Communication on April 24, 2025 and sell it today you would earn a total of  11.00  from holding Information and Communication or generate 6.25% return on investment over 90 days.

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

RB FOOD SUPPLY  vs.  Information and Communication

RB FOOD SUPPLY

Risk-Adjusted Performance

Very Weak

Over the last 90 days RB FOOD SUPPLY has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Information and Comm

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Information and Communication are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Information may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with RB FOOD and Information

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

The idea behind RB FOOD SUPPLY and Information and Communication 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 Global Correlations module to find global opportunities by holding instruments from different markets.