Correlation Between China Clean and Boston Beer
Can any of the company-specific risk be diversified away by investing in both China Clean and Boston Beer 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 China Clean and Boston Beer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Clean Energy and Boston Beer, you can compare the effects of market volatilities on China Clean and Boston Beer 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 China Clean with a short position of Boston Beer. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Clean and Boston Beer.
Diversification Opportunities for China Clean and Boston Beer
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Boston is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Clean Energy and Boston Beer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Beer and China Clean 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 China Clean Energy are associated (or correlated) with Boston Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Beer has no effect on the direction of China Clean i.e., China Clean and Boston Beer go up and down completely randomly.
Pair Corralation between China Clean and Boston Beer
If you would invest 30,433 in Boston Beer on August 29, 2024 and sell it today you would earn a total of 935.00 from holding Boston Beer or generate 3.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Clean Energy vs. Boston Beer
Performance |
| Timeline |
| China Clean Energy |
| Boston Beer |
China Clean and Boston Beer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Clean and Boston Beer
The main advantage of trading using opposite China Clean and Boston Beer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Clean position performs unexpectedly, Boston Beer 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 Boston Beer will offset losses from the drop in Boston Beer's long position.| China Clean vs. Akzo Nobel NV | China Clean vs. Avoca LLC | China Clean vs. Arkema SA ADR | China Clean vs. HUMANA INC |
| Boston Beer vs. Fomento Economico Mexicano | Boston Beer vs. Carlsberg AS | Boston Beer vs. Molson Coors Beverage | Boston Beer vs. Molson Coors Brewing |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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