Correlation Between Fidus Investment and National Beverage
Can any of the company-specific risk be diversified away by investing in both Fidus Investment and National Beverage 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 Fidus Investment and National Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidus Investment Corp and National Beverage Corp, you can compare the effects of market volatilities on Fidus Investment and National Beverage 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 Fidus Investment with a short position of National Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidus Investment and National Beverage.
Diversification Opportunities for Fidus Investment and National Beverage
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidus and National is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Fidus Investment Corp and National Beverage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Beverage Corp and Fidus Investment 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 Fidus Investment Corp are associated (or correlated) with National Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Beverage Corp has no effect on the direction of Fidus Investment i.e., Fidus Investment and National Beverage go up and down completely randomly.
Pair Corralation between Fidus Investment and National Beverage
Given the investment horizon of 90 days Fidus Investment Corp is expected to generate 0.55 times more return on investment than National Beverage. However, Fidus Investment Corp is 1.8 times less risky than National Beverage. It trades about 0.38 of its potential returns per unit of risk. National Beverage Corp is currently generating about 0.2 per unit of risk. If you would invest 1,966 in Fidus Investment Corp on August 29, 2024 and sell it today you would earn a total of 140.00 from holding Fidus Investment Corp or generate 7.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Fidus Investment Corp vs. National Beverage Corp
Performance |
| Timeline |
| Fidus Investment Corp |
| National Beverage Corp |
Fidus Investment and National Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidus Investment and National Beverage
The main advantage of trading using opposite Fidus Investment and National Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidus Investment position performs unexpectedly, National Beverage 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 National Beverage will offset losses from the drop in National Beverage's long position.| Fidus Investment vs. Golub Capital BDC | Fidus Investment vs. BlackRock TCP Capital | Fidus Investment vs. Carlyle Secured Lending | Fidus Investment vs. Sixth Street Specialty |
| National Beverage vs. Celsius Holdings | National Beverage vs. Monster Beverage Corp | National Beverage vs. Coca Cola Femsa SAB | National Beverage vs. Keurig Dr Pepper |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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