Correlation Between National Beverage and LION ONE
Can any of the company-specific risk be diversified away by investing in both National Beverage and LION ONE 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 National Beverage and LION ONE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Beverage Corp and LION ONE METALS, you can compare the effects of market volatilities on National Beverage and LION ONE 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 National Beverage with a short position of LION ONE. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Beverage and LION ONE.
Diversification Opportunities for National Beverage and LION ONE
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between National and LION is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding National Beverage Corp and LION ONE METALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LION ONE METALS and National Beverage 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 National Beverage Corp are associated (or correlated) with LION ONE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LION ONE METALS has no effect on the direction of National Beverage i.e., National Beverage and LION ONE go up and down completely randomly.
Pair Corralation between National Beverage and LION ONE
Assuming the 90 days horizon National Beverage Corp is expected to generate 0.43 times more return on investment than LION ONE. However, National Beverage Corp is 2.3 times less risky than LION ONE. It trades about 0.14 of its potential returns per unit of risk. LION ONE METALS is currently generating about -0.16 per unit of risk. If you would invest 4,100 in National Beverage Corp on September 13, 2024 and sell it today you would earn a total of 440.00 from holding National Beverage Corp or generate 10.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Beverage Corp vs. LION ONE METALS
Performance |
| Timeline |
| National Beverage Corp |
| LION ONE METALS |
National Beverage and LION ONE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Beverage and LION ONE
The main advantage of trading using opposite National Beverage and LION ONE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Beverage position performs unexpectedly, LION ONE 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 LION ONE will offset losses from the drop in LION ONE's long position.| National Beverage vs. Superior Plus Corp | National Beverage vs. SIVERS SEMICONDUCTORS AB | National Beverage vs. NorAm Drilling AS | National Beverage vs. Norsk Hydro ASA |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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