Correlation Between Fevertree Drinks and ONEOK
Can any of the company-specific risk be diversified away by investing in both Fevertree Drinks and ONEOK 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 Fevertree Drinks and ONEOK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fevertree Drinks PLC and ONEOK Inc, you can compare the effects of market volatilities on Fevertree Drinks and ONEOK 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 Fevertree Drinks with a short position of ONEOK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fevertree Drinks and ONEOK.
Diversification Opportunities for Fevertree Drinks and ONEOK
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fevertree and ONEOK is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Fevertree Drinks PLC and ONEOK Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ONEOK Inc and Fevertree Drinks 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 Fevertree Drinks PLC are associated (or correlated) with ONEOK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ONEOK Inc has no effect on the direction of Fevertree Drinks i.e., Fevertree Drinks and ONEOK go up and down completely randomly.
Pair Corralation between Fevertree Drinks and ONEOK
Assuming the 90 days trading horizon Fevertree Drinks PLC is expected to generate 1.11 times more return on investment than ONEOK. However, Fevertree Drinks is 1.11 times more volatile than ONEOK Inc. It trades about 0.07 of its potential returns per unit of risk. ONEOK Inc is currently generating about -0.09 per unit of risk. If you would invest 855.00 in Fevertree Drinks PLC on September 13, 2024 and sell it today you would earn a total of 20.00 from holding Fevertree Drinks PLC or generate 2.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fevertree Drinks PLC vs. ONEOK Inc
Performance |
| Timeline |
| Fevertree Drinks PLC |
| ONEOK Inc |
Fevertree Drinks and ONEOK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fevertree Drinks and ONEOK
The main advantage of trading using opposite Fevertree Drinks and ONEOK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fevertree Drinks position performs unexpectedly, ONEOK 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 ONEOK will offset losses from the drop in ONEOK's long position.| Fevertree Drinks vs. Ming Le Sports | Fevertree Drinks vs. SPORT LISBOA E | Fevertree Drinks vs. MGIC INVESTMENT | Fevertree Drinks vs. Big 5 Sporting |
| ONEOK vs. Casio Computer CoLtd | ONEOK vs. PKSHA TECHNOLOGY INC | ONEOK vs. Amkor Technology | ONEOK vs. Check Point Software |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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