Correlation Between KRISPY KREME and CSX
Can any of the company-specific risk be diversified away by investing in both KRISPY KREME and CSX 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 CSX 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 CSX Corporation, you can compare the effects of market volatilities on KRISPY KREME and CSX 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 CSX. Check out your portfolio center. Please also check ongoing floating volatility patterns of KRISPY KREME and CSX.
Diversification Opportunities for KRISPY KREME and CSX
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between KRISPY and CSX is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding KRISPY KREME DL 01 and CSX Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSX Corporation 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 CSX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSX Corporation has no effect on the direction of KRISPY KREME i.e., KRISPY KREME and CSX go up and down completely randomly.
Pair Corralation between KRISPY KREME and CSX
Assuming the 90 days horizon KRISPY KREME DL 01 is expected to under-perform the CSX. In addition to that, KRISPY KREME is 1.04 times more volatile than CSX Corporation. It trades about -0.42 of its total potential returns per unit of risk. CSX Corporation is currently generating about -0.2 per unit of volatility. If you would invest 3,397 in CSX Corporation on September 13, 2024 and sell it today you would lose (207.00) from holding CSX Corporation or give up 6.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KRISPY KREME DL 01 vs. CSX Corp.
Performance |
| Timeline |
| KRISPY KREME DL |
| CSX Corporation |
KRISPY KREME and CSX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KRISPY KREME and CSX
The main advantage of trading using opposite KRISPY KREME and CSX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KRISPY KREME position performs unexpectedly, CSX 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 CSX will offset losses from the drop in CSX's long position.| KRISPY KREME vs. Woolworths Group Limited | KRISPY KREME vs. Loblaw Companies Limited | KRISPY KREME vs. Superior Plus Corp | KRISPY KREME vs. SIVERS SEMICONDUCTORS AB |
| CSX vs. SBA Communications Corp | CSX vs. IMPERIAL TOBACCO | CSX vs. American Airlines Group | CSX vs. Shenandoah Telecommunications |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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