Correlation Between Compania Cervecerias and Beyond Meat
Can any of the company-specific risk be diversified away by investing in both Compania Cervecerias and Beyond Meat 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 Compania Cervecerias and Beyond Meat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compania Cervecerias Unidas and Beyond Meat, you can compare the effects of market volatilities on Compania Cervecerias and Beyond Meat 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 Compania Cervecerias with a short position of Beyond Meat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compania Cervecerias and Beyond Meat.
Diversification Opportunities for Compania Cervecerias and Beyond Meat
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Compania and Beyond is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Compania Cervecerias Unidas and Beyond Meat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Meat and Compania Cervecerias 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 Compania Cervecerias Unidas are associated (or correlated) with Beyond Meat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond Meat has no effect on the direction of Compania Cervecerias i.e., Compania Cervecerias and Beyond Meat go up and down completely randomly.
Pair Corralation between Compania Cervecerias and Beyond Meat
Considering the 90-day investment horizon Compania Cervecerias is expected to generate 1.1 times less return on investment than Beyond Meat. But when comparing it to its historical volatility, Compania Cervecerias Unidas is 3.58 times less risky than Beyond Meat. It trades about 0.33 of its potential returns per unit of risk. Beyond Meat is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 385.00 in Beyond Meat on November 2, 2024 and sell it today you would earn a total of 22.00 from holding Beyond Meat or generate 5.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compania Cervecerias Unidas vs. Beyond Meat
Performance |
| Timeline |
| Compania Cervecerias |
| Beyond Meat |
Compania Cervecerias and Beyond Meat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compania Cervecerias and Beyond Meat
The main advantage of trading using opposite Compania Cervecerias and Beyond Meat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compania Cervecerias position performs unexpectedly, Beyond Meat 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 Beyond Meat will offset losses from the drop in Beyond Meat's long position.| Compania Cervecerias vs. Boston Beer | Compania Cervecerias vs. Molson Coors Beverage | Compania Cervecerias vs. Ambev SA ADR | Compania Cervecerias vs. Molson Coors Brewing |
| Beyond Meat vs. Kraft Heinz Co | Beyond Meat vs. Hormel Foods | Beyond Meat vs. Kellanova | Beyond Meat vs. General Mills |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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