Correlation Between Vita Coco and Ihuman
Can any of the company-specific risk be diversified away by investing in both Vita Coco and Ihuman 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 Ihuman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vita Coco and Ihuman Inc, you can compare the effects of market volatilities on Vita Coco and Ihuman 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 Ihuman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vita Coco and Ihuman.
Diversification Opportunities for Vita Coco and Ihuman
Good diversification
The 3 months correlation between Vita and Ihuman is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Vita Coco and Ihuman Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ihuman Inc 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 Ihuman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ihuman Inc has no effect on the direction of Vita Coco i.e., Vita Coco and Ihuman go up and down completely randomly.
Pair Corralation between Vita Coco and Ihuman
Given the investment horizon of 90 days Vita Coco is expected to generate 0.66 times more return on investment than Ihuman. However, Vita Coco is 1.51 times less risky than Ihuman. It trades about 0.09 of its potential returns per unit of risk. Ihuman Inc is currently generating about 0.02 per unit of risk. If you would invest 1,243 in Vita Coco on September 3, 2024 and sell it today you would earn a total of 2,311 from holding Vita Coco or generate 185.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vita Coco vs. Ihuman Inc
Performance |
| Timeline |
| Vita Coco |
| Ihuman Inc |
Vita Coco and Ihuman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vita Coco and Ihuman
The main advantage of trading using opposite Vita Coco and Ihuman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vita Coco position performs unexpectedly, Ihuman 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 Ihuman will offset losses from the drop in Ihuman'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 |
| Ihuman vs. Boqii Holding Limited | Ihuman vs. Lixiang Education Holding | Ihuman vs. Huize Holding | Ihuman vs. Kuke Music Holding |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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