Correlation Between National Beverage and Active Health
Can any of the company-specific risk be diversified away by investing in both National Beverage and Active Health 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 Active Health 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 Active Health Foods, you can compare the effects of market volatilities on National Beverage and Active Health 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 Active Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Beverage and Active Health.
Diversification Opportunities for National Beverage and Active Health
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between National and Active is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding National Beverage Corp and Active Health Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Active Health Foods 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 Active Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Active Health Foods has no effect on the direction of National Beverage i.e., National Beverage and Active Health go up and down completely randomly.
Pair Corralation between National Beverage and Active Health
If you would invest 4,519 in National Beverage Corp on September 1, 2024 and sell it today you would earn a total of 420.00 from holding National Beverage Corp or generate 9.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Beverage Corp vs. Active Health Foods
Performance |
| Timeline |
| National Beverage Corp |
| Active Health Foods |
National Beverage and Active Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Beverage and Active Health
The main advantage of trading using opposite National Beverage and Active Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Beverage position performs unexpectedly, Active Health 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 Active Health will offset losses from the drop in Active Health'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 |
| Active Health vs. Ventana Biotech | Active Health vs. Gold Ent Group | Active Health vs. Profitable Develop | Active Health vs. American Leisure Holdings |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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