Correlation Between ATHENE HOLDING and PepsiCo
Can any of the company-specific risk be diversified away by investing in both ATHENE HOLDING and PepsiCo 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 ATHENE HOLDING and PepsiCo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATHENE HOLDING PRFSERC and PepsiCo, you can compare the effects of market volatilities on ATHENE HOLDING and PepsiCo 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 ATHENE HOLDING with a short position of PepsiCo. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATHENE HOLDING and PepsiCo.
Diversification Opportunities for ATHENE HOLDING and PepsiCo
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ATHENE and PepsiCo is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding ATHENE HOLDING PRFSERC and PepsiCo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PepsiCo and ATHENE HOLDING 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 ATHENE HOLDING PRFSERC are associated (or correlated) with PepsiCo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PepsiCo has no effect on the direction of ATHENE HOLDING i.e., ATHENE HOLDING and PepsiCo go up and down completely randomly.
Pair Corralation between ATHENE HOLDING and PepsiCo
Assuming the 90 days trading horizon ATHENE HOLDING PRFSERC is expected to generate 0.67 times more return on investment than PepsiCo. However, ATHENE HOLDING PRFSERC is 1.49 times less risky than PepsiCo. It trades about 0.09 of its potential returns per unit of risk. PepsiCo is currently generating about -0.01 per unit of risk. If you would invest 2,013 in ATHENE HOLDING PRFSERC on September 28, 2024 and sell it today you would earn a total of 347.00 from holding ATHENE HOLDING PRFSERC or generate 17.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATHENE HOLDING PRFSERC vs. PepsiCo
Performance |
| Timeline |
| ATHENE HOLDING PRFSERC |
| PepsiCo |
ATHENE HOLDING and PepsiCo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATHENE HOLDING and PepsiCo
The main advantage of trading using opposite ATHENE HOLDING and PepsiCo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATHENE HOLDING position performs unexpectedly, PepsiCo 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 PepsiCo will offset losses from the drop in PepsiCo's long position.| ATHENE HOLDING vs. Berkshire Hathaway | ATHENE HOLDING vs. Allianz SE VNA | ATHENE HOLDING vs. AXA SA | ATHENE HOLDING vs. Assicurazioni Generali SpA |
| PepsiCo vs. THAI BEVERAGE | PepsiCo vs. AM EAGLE OUTFITTERS | PepsiCo vs. SENECA FOODS A | PepsiCo vs. TYSON FOODS A |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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