Correlation Between Anheuser Busch and Eastman Kodak
Can any of the company-specific risk be diversified away by investing in both Anheuser Busch and Eastman Kodak 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 Anheuser Busch and Eastman Kodak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anheuser Busch Inbev and Eastman Kodak Co, you can compare the effects of market volatilities on Anheuser Busch and Eastman Kodak 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 Anheuser Busch with a short position of Eastman Kodak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anheuser Busch and Eastman Kodak.
Diversification Opportunities for Anheuser Busch and Eastman Kodak
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Anheuser and Eastman is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Anheuser Busch Inbev and Eastman Kodak Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Kodak and Anheuser Busch 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 Anheuser Busch Inbev are associated (or correlated) with Eastman Kodak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastman Kodak has no effect on the direction of Anheuser Busch i.e., Anheuser Busch and Eastman Kodak go up and down completely randomly.
Pair Corralation between Anheuser Busch and Eastman Kodak
Considering the 90-day investment horizon Anheuser Busch is expected to generate 30.58 times less return on investment than Eastman Kodak. But when comparing it to its historical volatility, Anheuser Busch Inbev is 3.37 times less risky than Eastman Kodak. It trades about 0.0 of its potential returns per unit of risk. Eastman Kodak Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 528.00 in Eastman Kodak Co on September 2, 2024 and sell it today you would earn a total of 197.00 from holding Eastman Kodak Co or generate 37.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anheuser Busch Inbev vs. Eastman Kodak Co
Performance |
| Timeline |
| Anheuser Busch Inbev |
| Eastman Kodak |
Anheuser Busch and Eastman Kodak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anheuser Busch and Eastman Kodak
The main advantage of trading using opposite Anheuser Busch and Eastman Kodak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anheuser Busch position performs unexpectedly, Eastman Kodak 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 Eastman Kodak will offset losses from the drop in Eastman Kodak's long position.| Anheuser Busch vs. Boston Beer | Anheuser Busch vs. Molson Coors Beverage | Anheuser Busch vs. Heineken NV | Anheuser Busch vs. Ambev SA ADR |
| Eastman Kodak vs. SMX Public Limited | Eastman Kodak vs. System1 | Eastman Kodak vs. Lichen China Limited | Eastman Kodak vs. Team Inc |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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