Correlation Between National Beverage and Weyco
Can any of the company-specific risk be diversified away by investing in both National Beverage and Weyco 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 Weyco 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 Weyco Group, you can compare the effects of market volatilities on National Beverage and Weyco 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 Weyco. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Beverage and Weyco.
Diversification Opportunities for National Beverage and Weyco
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between National and Weyco is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding National Beverage Corp and Weyco Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weyco Group 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 Weyco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weyco Group has no effect on the direction of National Beverage i.e., National Beverage and Weyco go up and down completely randomly.
Pair Corralation between National Beverage and Weyco
Given the investment horizon of 90 days National Beverage Corp is expected to generate 0.85 times more return on investment than Weyco. However, National Beverage Corp is 1.18 times less risky than Weyco. It trades about -0.27 of its potential returns per unit of risk. Weyco Group is currently generating about -0.26 per unit of risk. If you would invest 4,537 in National Beverage Corp on October 21, 2024 and sell it today you would lose (287.00) from holding National Beverage Corp or give up 6.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Beverage Corp vs. Weyco Group
Performance |
| Timeline |
| National Beverage Corp |
| Weyco Group |
National Beverage and Weyco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Beverage and Weyco
The main advantage of trading using opposite National Beverage and Weyco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Beverage position performs unexpectedly, Weyco 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 Weyco will offset losses from the drop in Weyco's long position.| National Beverage vs. Monster Beverage Corp | National Beverage vs. Celsius Holdings | National Beverage vs. Coca Cola Consolidated | National Beverage vs. PepsiCo |
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.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |