Correlation Between KRISPY KREME and Sartorius Stedim
Can any of the company-specific risk be diversified away by investing in both KRISPY KREME and Sartorius Stedim 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 KRISPY KREME and Sartorius Stedim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KRISPY KREME DL 01 and Sartorius Stedim Biotech, you can compare the effects of market volatilities on KRISPY KREME and Sartorius Stedim 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 KRISPY KREME with a short position of Sartorius Stedim. Check out your portfolio center. Please also check ongoing floating volatility patterns of KRISPY KREME and Sartorius Stedim.
Diversification Opportunities for KRISPY KREME and Sartorius Stedim
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between KRISPY and Sartorius is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding KRISPY KREME DL 01 and Sartorius Stedim Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sartorius Stedim Biotech and KRISPY KREME 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 KRISPY KREME DL 01 are associated (or correlated) with Sartorius Stedim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sartorius Stedim Biotech has no effect on the direction of KRISPY KREME i.e., KRISPY KREME and Sartorius Stedim go up and down completely randomly.
Pair Corralation between KRISPY KREME and Sartorius Stedim
Assuming the 90 days horizon KRISPY KREME DL 01 is expected to under-perform the Sartorius Stedim. But the stock apears to be less risky and, when comparing its historical volatility, KRISPY KREME DL 01 is 1.57 times less risky than Sartorius Stedim. The stock trades about -0.56 of its potential returns per unit of risk. The Sartorius Stedim Biotech is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 17,765 in Sartorius Stedim Biotech on September 25, 2024 and sell it today you would earn a total of 660.00 from holding Sartorius Stedim Biotech or generate 3.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
KRISPY KREME DL 01 vs. Sartorius Stedim Biotech
Performance |
| Timeline |
| KRISPY KREME DL |
| Sartorius Stedim Biotech |
KRISPY KREME and Sartorius Stedim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KRISPY KREME and Sartorius Stedim
The main advantage of trading using opposite KRISPY KREME and Sartorius Stedim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KRISPY KREME position performs unexpectedly, Sartorius Stedim 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 Sartorius Stedim will offset losses from the drop in Sartorius Stedim's long position.| KRISPY KREME vs. SEVENI HLDGS UNSPADR12 | KRISPY KREME vs. Seven i Holdings | KRISPY KREME vs. The Kroger Co | KRISPY KREME vs. Koninklijke Ahold Delhaize |
| Sartorius Stedim vs. KRISPY KREME DL 01 | Sartorius Stedim vs. Fukuyama Transporting Co | Sartorius Stedim vs. Verizon Communications | Sartorius Stedim vs. Cogent Communications Holdings |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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