Correlation Between Crumbs Bake and Romana Food

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Can any of the company-specific risk be diversified away by investing in both Crumbs Bake and Romana Food 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 Crumbs Bake and Romana Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crumbs Bake Shop and Romana Food Brands, you can compare the effects of market volatilities on Crumbs Bake and Romana Food 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 Crumbs Bake with a short position of Romana Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crumbs Bake and Romana Food.

Diversification Opportunities for Crumbs Bake and Romana Food

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Crumbs and Romana is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Crumbs Bake Shop and Romana Food Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Romana Food Brands and Crumbs Bake 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 Crumbs Bake Shop are associated (or correlated) with Romana Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Romana Food Brands has no effect on the direction of Crumbs Bake i.e., Crumbs Bake and Romana Food go up and down completely randomly.

Pair Corralation between Crumbs Bake and Romana Food

If you would invest  0.01  in Romana Food Brands on August 26, 2025 and sell it today you would earn a total of  0.00  from holding Romana Food Brands or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Crumbs Bake Shop  vs.  Romana Food Brands

 Performance 
       Timeline  
Crumbs Bake Shop 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Crumbs Bake Shop has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental drivers, Crumbs Bake is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.
Romana Food Brands 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Romana Food Brands has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental drivers, Romana Food is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Crumbs Bake and Romana Food Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Crumbs Bake and Romana Food

The main advantage of trading using opposite Crumbs Bake and Romana Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crumbs Bake position performs unexpectedly, Romana Food 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 Romana Food will offset losses from the drop in Romana Food's long position.
The idea behind Crumbs Bake Shop and Romana Food Brands 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.

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