Correlation Between Acco Brands and Heritage Distilling
Can any of the company-specific risk be diversified away by investing in both Acco Brands and Heritage Distilling 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 Acco Brands and Heritage Distilling into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acco Brands and Heritage Distilling Holding, you can compare the effects of market volatilities on Acco Brands and Heritage Distilling 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 Acco Brands with a short position of Heritage Distilling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acco Brands and Heritage Distilling.
Diversification Opportunities for Acco Brands and Heritage Distilling
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Acco and Heritage is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and Heritage Distilling Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heritage Distilling and Acco Brands 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 Acco Brands are associated (or correlated) with Heritage Distilling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heritage Distilling has no effect on the direction of Acco Brands i.e., Acco Brands and Heritage Distilling go up and down completely randomly.
Pair Corralation between Acco Brands and Heritage Distilling
Given the investment horizon of 90 days Acco Brands is expected to generate 0.21 times more return on investment than Heritage Distilling. However, Acco Brands is 4.83 times less risky than Heritage Distilling. It trades about 0.1 of its potential returns per unit of risk. Heritage Distilling Holding is currently generating about -0.15 per unit of risk. If you would invest 519.00 in Acco Brands on November 2, 2024 and sell it today you would earn a total of 13.00 from holding Acco Brands or generate 2.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acco Brands vs. Heritage Distilling Holding
Performance |
| Timeline |
| Acco Brands |
| Heritage Distilling |
Acco Brands and Heritage Distilling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acco Brands and Heritage Distilling
The main advantage of trading using opposite Acco Brands and Heritage Distilling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acco Brands position performs unexpectedly, Heritage Distilling 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 Heritage Distilling will offset losses from the drop in Heritage Distilling's long position.| Acco Brands vs. HNI Corp | Acco Brands vs. Steelcase | Acco Brands vs. Ennis Inc | Acco Brands vs. Acacia Research |
| Heritage Distilling vs. CNA Financial | Heritage Distilling vs. Alignment Healthcare LLC | Heritage Distilling vs. Root Inc | Heritage Distilling vs. Unum Group |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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