Correlation Between Continental Beverage and IFAN Financial
Can any of the company-specific risk be diversified away by investing in both Continental Beverage and IFAN Financial 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 IFAN Financial 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 IFAN Financial, you can compare the effects of market volatilities on Continental Beverage and IFAN Financial 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 IFAN Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Continental Beverage and IFAN Financial.
Diversification Opportunities for Continental Beverage and IFAN Financial
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Continental and IFAN is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Continental Beverage Brands and IFAN Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IFAN Financial 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 IFAN Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IFAN Financial has no effect on the direction of Continental Beverage i.e., Continental Beverage and IFAN Financial go up and down completely randomly.
Pair Corralation between Continental Beverage and IFAN Financial
Given the investment horizon of 90 days Continental Beverage Brands is expected to generate 3.58 times more return on investment than IFAN Financial. However, Continental Beverage is 3.58 times more volatile than IFAN Financial. It trades about 0.18 of its potential returns per unit of risk. IFAN Financial is currently generating about 0.13 per unit of risk. If you would invest 19.00 in Continental Beverage Brands on September 3, 2024 and sell it today you would earn a total of 56.00 from holding Continental Beverage Brands or generate 294.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Continental Beverage Brands vs. IFAN Financial
Performance |
| Timeline |
| Continental Beverage |
| IFAN Financial |
Continental Beverage and IFAN Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Continental Beverage and IFAN Financial
The main advantage of trading using opposite Continental Beverage and IFAN Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Continental Beverage position performs unexpectedly, IFAN Financial 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 IFAN Financial will offset losses from the drop in IFAN Financial'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 |
| IFAN Financial vs. Manaris Corp | IFAN Financial vs. Green Planet Bio | IFAN Financial vs. Continental Beverage Brands | IFAN Financial vs. Opus Magnum Ameris |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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