Correlation Between Hertz Global and National Beverage
Can any of the company-specific risk be diversified away by investing in both Hertz Global and National Beverage 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 Hertz Global and National Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hertz Global Holdings and National Beverage Corp, you can compare the effects of market volatilities on Hertz Global and National Beverage 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 Hertz Global with a short position of National Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hertz Global and National Beverage.
Diversification Opportunities for Hertz Global and National Beverage
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hertz and National is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Hertz Global Holdings and National Beverage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Beverage Corp and Hertz Global 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 Hertz Global Holdings are associated (or correlated) with National Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Beverage Corp has no effect on the direction of Hertz Global i.e., Hertz Global and National Beverage go up and down completely randomly.
Pair Corralation between Hertz Global and National Beverage
Considering the 90-day investment horizon Hertz Global Holdings is expected to under-perform the National Beverage. In addition to that, Hertz Global is 2.34 times more volatile than National Beverage Corp. It trades about -0.04 of its total potential returns per unit of risk. National Beverage Corp is currently generating about 0.03 per unit of volatility. If you would invest 4,148 in National Beverage Corp on August 31, 2024 and sell it today you would earn a total of 791.00 from holding National Beverage Corp or generate 19.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Hertz Global Holdings vs. National Beverage Corp
Performance |
| Timeline |
| Hertz Global Holdings |
| National Beverage Corp |
Hertz Global and National Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hertz Global and National Beverage
The main advantage of trading using opposite Hertz Global and National Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hertz Global position performs unexpectedly, National Beverage 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 National Beverage will offset losses from the drop in National Beverage's long position.| Hertz Global vs. United Rentals | Hertz Global vs. Ryder System | Hertz Global vs. Herc Holdings | Hertz Global vs. Air Lease |
| National Beverage vs. Celsius Holdings | National Beverage vs. Monster Beverage Corp | National Beverage vs. Coca Cola Femsa SAB | National Beverage vs. Keurig Dr Pepper |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |