Correlation Between National Beverage and Brunswick
Can any of the company-specific risk be diversified away by investing in both National Beverage and Brunswick 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 Brunswick 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 Brunswick, you can compare the effects of market volatilities on National Beverage and Brunswick 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 Brunswick. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Beverage and Brunswick.
Diversification Opportunities for National Beverage and Brunswick
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between National and Brunswick is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding National Beverage Corp and Brunswick in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunswick 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 Brunswick. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunswick has no effect on the direction of National Beverage i.e., National Beverage and Brunswick go up and down completely randomly.
Pair Corralation between National Beverage and Brunswick
Given the investment horizon of 90 days National Beverage Corp is expected to generate 0.78 times more return on investment than Brunswick. However, National Beverage Corp is 1.27 times less risky than Brunswick. It trades about 0.06 of its potential returns per unit of risk. Brunswick is currently generating about 0.02 per unit of risk. If you would invest 4,435 in National Beverage Corp on September 12, 2024 and sell it today you would earn a total of 246.00 from holding National Beverage Corp or generate 5.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Beverage Corp vs. Brunswick
Performance |
| Timeline |
| National Beverage Corp |
| Brunswick |
National Beverage and Brunswick Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Beverage and Brunswick
The main advantage of trading using opposite National Beverage and Brunswick positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Beverage position performs unexpectedly, Brunswick 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 Brunswick will offset losses from the drop in Brunswick'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 |
| Brunswick vs. Clarus Corp | Brunswick vs. Escalade Incorporated | Brunswick vs. Johnson Outdoors | Brunswick vs. JAKKS Pacific |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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