Correlation Between A2 Milk and NH Foods
Can any of the company-specific risk be diversified away by investing in both A2 Milk and NH Foods 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 A2 Milk and NH Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The a2 Milk and NH Foods Ltd, you can compare the effects of market volatilities on A2 Milk and NH Foods 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 A2 Milk with a short position of NH Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of A2 Milk and NH Foods.
Diversification Opportunities for A2 Milk and NH Foods
Modest diversification
The 3 months correlation between ACOPF and NIPMY is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding The a2 Milk and NH Foods Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Foods and A2 Milk 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 The a2 Milk are associated (or correlated) with NH Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Foods has no effect on the direction of A2 Milk i.e., A2 Milk and NH Foods go up and down completely randomly.
Pair Corralation between A2 Milk and NH Foods
Assuming the 90 days horizon A2 Milk is expected to generate 13.91 times less return on investment than NH Foods. But when comparing it to its historical volatility, The a2 Milk is 1.12 times less risky than NH Foods. It trades about 0.01 of its potential returns per unit of risk. NH Foods Ltd is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,700 in NH Foods Ltd on September 12, 2025 and sell it today you would earn a total of 450.00 from holding NH Foods Ltd or generate 26.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The a2 Milk vs. NH Foods Ltd
Performance |
| Timeline |
| a2 Milk |
| NH Foods |
A2 Milk and NH Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with A2 Milk and NH Foods
The main advantage of trading using opposite A2 Milk and NH Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if A2 Milk position performs unexpectedly, NH Foods 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 NH Foods will offset losses from the drop in NH Foods' long position.| A2 Milk vs. Glanbia plc | A2 Milk vs. China Feihe Limited | A2 Milk vs. Indofood Sukses Makmur | A2 Milk vs. NH Foods Ltd |
| NH Foods vs. First Pacific | NH Foods vs. First Pacific | NH Foods vs. Tate Lyle plc | NH Foods vs. The a2 Milk |
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 the Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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