Correlation Between Oceanic Beverages and La Kaffa
Can any of the company-specific risk be diversified away by investing in both Oceanic Beverages and La Kaffa 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 Oceanic Beverages and La Kaffa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oceanic Beverages Co and La Kaffa International, you can compare the effects of market volatilities on Oceanic Beverages and La Kaffa 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 Oceanic Beverages with a short position of La Kaffa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oceanic Beverages and La Kaffa.
Diversification Opportunities for Oceanic Beverages and La Kaffa
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Oceanic and 2732 is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Oceanic Beverages Co and La Kaffa International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on La Kaffa International and Oceanic Beverages 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 Oceanic Beverages Co are associated (or correlated) with La Kaffa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of La Kaffa International has no effect on the direction of Oceanic Beverages i.e., Oceanic Beverages and La Kaffa go up and down completely randomly.
Pair Corralation between Oceanic Beverages and La Kaffa
Assuming the 90 days trading horizon Oceanic Beverages Co is expected to under-perform the La Kaffa. In addition to that, Oceanic Beverages is 1.68 times more volatile than La Kaffa International. It trades about -0.18 of its total potential returns per unit of risk. La Kaffa International is currently generating about -0.24 per unit of volatility. If you would invest 10,300 in La Kaffa International on October 21, 2024 and sell it today you would lose (640.00) from holding La Kaffa International or give up 6.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oceanic Beverages Co vs. La Kaffa International
Performance |
| Timeline |
| Oceanic Beverages |
| La Kaffa International |
Oceanic Beverages and La Kaffa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oceanic Beverages and La Kaffa
The main advantage of trading using opposite Oceanic Beverages and La Kaffa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oceanic Beverages position performs unexpectedly, La Kaffa 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 La Kaffa will offset losses from the drop in La Kaffa's long position.| Oceanic Beverages vs. Hey Song Corp | Oceanic Beverages vs. AGV Products Corp | Oceanic Beverages vs. Fwusow Industry Co | Oceanic Beverages vs. Taisun Enterprise Co |
| La Kaffa vs. Hua Nan Financial | La Kaffa vs. Yeou Yih Steel | La Kaffa vs. Taiwan Steel Union | La Kaffa vs. Kings Town Bank |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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