Correlation Between National Beverage and Aegon Funding
Can any of the company-specific risk be diversified away by investing in both National Beverage and Aegon Funding 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 National Beverage and Aegon Funding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Beverage Corp and Aegon Funding, you can compare the effects of market volatilities on National Beverage and Aegon Funding 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 National Beverage with a short position of Aegon Funding. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Beverage and Aegon Funding.
Diversification Opportunities for National Beverage and Aegon Funding
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between National and Aegon is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding National Beverage Corp and Aegon Funding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegon Funding and National Beverage 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 National Beverage Corp are associated (or correlated) with Aegon Funding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegon Funding has no effect on the direction of National Beverage i.e., National Beverage and Aegon Funding go up and down completely randomly.
Pair Corralation between National Beverage and Aegon Funding
Given the investment horizon of 90 days National Beverage Corp is expected to generate 2.02 times more return on investment than Aegon Funding. However, National Beverage is 2.02 times more volatile than Aegon Funding. It trades about 0.03 of its potential returns per unit of risk. Aegon Funding is currently generating about 0.03 per unit of risk. If you would invest 4,433 in National Beverage Corp on August 31, 2024 and sell it today you would earn a total of 506.00 from holding National Beverage Corp or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Beverage Corp vs. Aegon Funding
Performance |
| Timeline |
| National Beverage Corp |
| Aegon Funding |
National Beverage and Aegon Funding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Beverage and Aegon Funding
The main advantage of trading using opposite National Beverage and Aegon Funding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Beverage position performs unexpectedly, Aegon Funding 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 Aegon Funding will offset losses from the drop in Aegon Funding's long position.| National Beverage vs. Celsius Holdings | National Beverage vs. Monster Beverage Corp | National Beverage vs. Coca Cola Femsa SAB | National Beverage vs. Keurig Dr Pepper |
| Aegon Funding vs. Petroleo Brasileiro Petrobras | Aegon Funding vs. Equinor ASA ADR | Aegon Funding vs. Eni SpA ADR | Aegon Funding vs. YPF Sociedad Anonima |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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