Correlation Between Aptiv PLC and KRAFT
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By analyzing existing cross correlation between Aptiv PLC and KRAFT FOODS GROUP, you can compare the effects of market volatilities on Aptiv PLC and KRAFT 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 Aptiv PLC with a short position of KRAFT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aptiv PLC and KRAFT.
Diversification Opportunities for Aptiv PLC and KRAFT
Very weak diversification
The 3 months correlation between Aptiv and KRAFT is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Aptiv PLC and KRAFT FOODS GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KRAFT FOODS GROUP and Aptiv PLC 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 Aptiv PLC are associated (or correlated) with KRAFT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KRAFT FOODS GROUP has no effect on the direction of Aptiv PLC i.e., Aptiv PLC and KRAFT go up and down completely randomly.
Pair Corralation between Aptiv PLC and KRAFT
Given the investment horizon of 90 days Aptiv PLC is expected to generate 3.3 times more return on investment than KRAFT. However, Aptiv PLC is 3.3 times more volatile than KRAFT FOODS GROUP. It trades about 0.02 of its potential returns per unit of risk. KRAFT FOODS GROUP is currently generating about 0.0 per unit of risk. If you would invest 5,593 in Aptiv PLC on September 4, 2024 and sell it today you would earn a total of 14.00 from holding Aptiv PLC or generate 0.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Aptiv PLC vs. KRAFT FOODS GROUP
Performance |
| Timeline |
| Aptiv PLC |
| KRAFT FOODS GROUP |
Aptiv PLC and KRAFT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aptiv PLC and KRAFT
The main advantage of trading using opposite Aptiv PLC and KRAFT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aptiv PLC position performs unexpectedly, KRAFT 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 KRAFT will offset losses from the drop in KRAFT's long position.| Aptiv PLC vs. Ford Motor | Aptiv PLC vs. General Motors | Aptiv PLC vs. Goodyear Tire Rubber | Aptiv PLC vs. Li Auto |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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