Correlation Between Beyond Meat and New Oriental
Can any of the company-specific risk be diversified away by investing in both Beyond Meat and New Oriental 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 Beyond Meat and New Oriental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beyond Meat and New Oriental Education, you can compare the effects of market volatilities on Beyond Meat and New Oriental 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 Beyond Meat with a short position of New Oriental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beyond Meat and New Oriental.
Diversification Opportunities for Beyond Meat and New Oriental
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Beyond and New is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Beyond Meat and New Oriental Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Oriental Education and Beyond Meat 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 Beyond Meat are associated (or correlated) with New Oriental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Oriental Education has no effect on the direction of Beyond Meat i.e., Beyond Meat and New Oriental go up and down completely randomly.
Pair Corralation between Beyond Meat and New Oriental
Assuming the 90 days trading horizon Beyond Meat is expected to generate 0.87 times more return on investment than New Oriental. However, Beyond Meat is 1.15 times less risky than New Oriental. It trades about 0.0 of its potential returns per unit of risk. New Oriental Education is currently generating about -0.21 per unit of risk. If you would invest 115.00 in Beyond Meat on November 5, 2024 and sell it today you would lose (3.00) from holding Beyond Meat or give up 2.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beyond Meat vs. New Oriental Education
Performance |
| Timeline |
| Beyond Meat |
| New Oriental Education |
Beyond Meat and New Oriental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beyond Meat and New Oriental
The main advantage of trading using opposite Beyond Meat and New Oriental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beyond Meat position performs unexpectedly, New Oriental 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 New Oriental will offset losses from the drop in New Oriental's long position.| Beyond Meat vs. salesforce inc | Beyond Meat vs. Air Products and | Beyond Meat vs. Tyson Foods | Beyond Meat vs. Nordon Indstrias Metalrgicas |
| New Oriental vs. Charter Communications | New Oriental vs. SSC Technologies Holdings, | New Oriental vs. Spotify Technology SA | New Oriental vs. Cognizant Technology Solutions |
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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