Correlation Between Vita Coco and Bridger Aerospace
Can any of the company-specific risk be diversified away by investing in both Vita Coco and Bridger Aerospace 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 Vita Coco and Bridger Aerospace into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vita Coco and Bridger Aerospace Group, you can compare the effects of market volatilities on Vita Coco and Bridger Aerospace 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 Vita Coco with a short position of Bridger Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vita Coco and Bridger Aerospace.
Diversification Opportunities for Vita Coco and Bridger Aerospace
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Vita and Bridger is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Vita Coco and Bridger Aerospace Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridger Aerospace and Vita Coco 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 Vita Coco are associated (or correlated) with Bridger Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridger Aerospace has no effect on the direction of Vita Coco i.e., Vita Coco and Bridger Aerospace go up and down completely randomly.
Pair Corralation between Vita Coco and Bridger Aerospace
Given the investment horizon of 90 days Vita Coco is expected to generate 2.23 times less return on investment than Bridger Aerospace. But when comparing it to its historical volatility, Vita Coco is 8.63 times less risky than Bridger Aerospace. It trades about 0.1 of its potential returns per unit of risk. Bridger Aerospace Group is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 8.50 in Bridger Aerospace Group on September 12, 2024 and sell it today you would lose (1.00) from holding Bridger Aerospace Group or give up 11.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Vita Coco vs. Bridger Aerospace Group
Performance |
| Timeline |
| Vita Coco |
| Bridger Aerospace |
Vita Coco and Bridger Aerospace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vita Coco and Bridger Aerospace
The main advantage of trading using opposite Vita Coco and Bridger Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vita Coco position performs unexpectedly, Bridger Aerospace 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 Bridger Aerospace will offset losses from the drop in Bridger Aerospace's long position.| Vita Coco vs. Coca Cola Femsa SAB | Vita Coco vs. Coca Cola European Partners | Vita Coco vs. Embotelladora Andina SA | Vita Coco vs. Monster Beverage Corp |
| Bridger Aerospace vs. Hasbro Inc | Bridger Aerospace vs. JD Sports Fashion | Bridger Aerospace vs. Mattel Inc | Bridger Aerospace vs. Supercom |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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