Correlation Between Coffee Holding and EAT WELL
Can any of the company-specific risk be diversified away by investing in both Coffee Holding and EAT WELL 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 Coffee Holding and EAT WELL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coffee Holding Co and EAT WELL INVESTMENT, you can compare the effects of market volatilities on Coffee Holding and EAT WELL 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 Coffee Holding with a short position of EAT WELL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coffee Holding and EAT WELL.
Diversification Opportunities for Coffee Holding and EAT WELL
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coffee and EAT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Coffee Holding Co and EAT WELL INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EAT WELL INVESTMENT and Coffee Holding 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 Coffee Holding Co are associated (or correlated) with EAT WELL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EAT WELL INVESTMENT has no effect on the direction of Coffee Holding i.e., Coffee Holding and EAT WELL go up and down completely randomly.
Pair Corralation between Coffee Holding and EAT WELL
Assuming the 90 days horizon Coffee Holding Co is expected to generate 1.87 times more return on investment than EAT WELL. However, Coffee Holding is 1.87 times more volatile than EAT WELL INVESTMENT. It trades about 0.05 of its potential returns per unit of risk. EAT WELL INVESTMENT is currently generating about -0.01 per unit of risk. If you would invest 198.00 in Coffee Holding Co on November 7, 2024 and sell it today you would earn a total of 180.00 from holding Coffee Holding Co or generate 90.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Coffee Holding Co vs. EAT WELL INVESTMENT
Performance |
| Timeline |
| Coffee Holding |
| EAT WELL INVESTMENT |
Coffee Holding and EAT WELL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coffee Holding and EAT WELL
The main advantage of trading using opposite Coffee Holding and EAT WELL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coffee Holding position performs unexpectedly, EAT WELL 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 EAT WELL will offset losses from the drop in EAT WELL's long position.| Coffee Holding vs. Nestl SA | Coffee Holding vs. Kraft Heinz Co | Coffee Holding vs. General Mills | Coffee Holding vs. General Mills |
| EAT WELL vs. Blackstone Group | EAT WELL vs. The Bank of | EAT WELL vs. Ameriprise Financial | EAT WELL vs. State Street |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |