Correlation Between Procter Gamble and Natures Sunshine
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and Natures Sunshine 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 Procter Gamble and Natures Sunshine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and Natures Sunshine Products, you can compare the effects of market volatilities on Procter Gamble and Natures Sunshine 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 Procter Gamble with a short position of Natures Sunshine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and Natures Sunshine.
Diversification Opportunities for Procter Gamble and Natures Sunshine
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Procter and Natures is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and Natures Sunshine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natures Sunshine Products and Procter Gamble 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 Procter Gamble are associated (or correlated) with Natures Sunshine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natures Sunshine Products has no effect on the direction of Procter Gamble i.e., Procter Gamble and Natures Sunshine go up and down completely randomly.
Pair Corralation between Procter Gamble and Natures Sunshine
Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 2.47 times less return on investment than Natures Sunshine. But when comparing it to its historical volatility, Procter Gamble is 1.96 times less risky than Natures Sunshine. It trades about 0.17 of its potential returns per unit of risk. Natures Sunshine Products is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,610 in Natures Sunshine Products on June 11, 2025 and sell it today you would earn a total of 104.00 from holding Natures Sunshine Products or generate 6.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Procter Gamble vs. Natures Sunshine Products
Performance |
| Timeline |
| Procter Gamble |
| Natures Sunshine Products |
Procter Gamble and Natures Sunshine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and Natures Sunshine
The main advantage of trading using opposite Procter Gamble and Natures Sunshine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, Natures Sunshine 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 Natures Sunshine will offset losses from the drop in Natures Sunshine's long position.| Procter Gamble vs. The Clorox | Procter Gamble vs. Colgate Palmolive | Procter Gamble vs. Unilever PLC ADR | Procter Gamble vs. Church Dwight |
| Natures Sunshine vs. Central Garden Pet | Natures Sunshine vs. Central Garden Pet | Natures Sunshine vs. Lifevantage | Natures Sunshine vs. Lifeway Foods |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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