Correlation Between Continental Beverage and All American
Can any of the company-specific risk be diversified away by investing in both Continental Beverage and All American 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 Continental Beverage and All American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Continental Beverage Brands and All American Pet, you can compare the effects of market volatilities on Continental Beverage and All American 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 Continental Beverage with a short position of All American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Continental Beverage and All American.
Diversification Opportunities for Continental Beverage and All American
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Continental and All is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Continental Beverage Brands and All American Pet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on All American Pet and Continental Beverage 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 Continental Beverage Brands are associated (or correlated) with All American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of All American Pet has no effect on the direction of Continental Beverage i.e., Continental Beverage and All American go up and down completely randomly.
Pair Corralation between Continental Beverage and All American
Given the investment horizon of 90 days Continental Beverage Brands is expected to generate 4.18 times more return on investment than All American. However, Continental Beverage is 4.18 times more volatile than All American Pet. It trades about 0.2 of its potential returns per unit of risk. All American Pet is currently generating about -0.22 per unit of risk. If you would invest 20.00 in Continental Beverage Brands on September 12, 2024 and sell it today you would earn a total of 50.00 from holding Continental Beverage Brands or generate 250.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Continental Beverage Brands vs. All American Pet
Performance |
| Timeline |
| Continental Beverage |
| All American Pet |
Continental Beverage and All American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Continental Beverage and All American
The main advantage of trading using opposite Continental Beverage and All American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Continental Beverage position performs unexpectedly, All American 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 All American will offset losses from the drop in All American's long position.| Continental Beverage vs. Green Planet Bio | Continental Beverage vs. Azure Holding Group | Continental Beverage vs. Four Leaf Acquisition | Continental Beverage vs. Opus Magnum Ameris |
| All American vs. International Consolidated Companies | All American vs. Frontera Group | All American vs. XCPCNL Business Services | All American vs. Aramark Holdings |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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