Correlation Between Coffee Holding and KRAFT
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By analyzing existing cross correlation between Coffee Holding Co and KRAFT HEINZ FOODS, you can compare the effects of market volatilities on Coffee Holding and KRAFT 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 Coffee Holding with a short position of KRAFT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coffee Holding and KRAFT.
Diversification Opportunities for Coffee Holding and KRAFT
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Coffee and KRAFT is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Coffee Holding Co and KRAFT HEINZ FOODS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KRAFT HEINZ FOODS and Coffee Holding 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 Coffee Holding Co are associated (or correlated) with KRAFT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KRAFT HEINZ FOODS has no effect on the direction of Coffee Holding i.e., Coffee Holding and KRAFT go up and down completely randomly.
Pair Corralation between Coffee Holding and KRAFT
Considering the 90-day investment horizon Coffee Holding Co is expected to generate 18.13 times more return on investment than KRAFT. However, Coffee Holding is 18.13 times more volatile than KRAFT HEINZ FOODS. It trades about 0.13 of its potential returns per unit of risk. KRAFT HEINZ FOODS is currently generating about -0.09 per unit of risk. If you would invest 186.00 in Coffee Holding Co on November 3, 2024 and sell it today you would earn a total of 209.00 from holding Coffee Holding Co or generate 112.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Coffee Holding Co vs. KRAFT HEINZ FOODS
Performance |
| Timeline |
| Coffee Holding |
| KRAFT HEINZ FOODS |
Coffee Holding and KRAFT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coffee Holding and KRAFT
The main advantage of trading using opposite Coffee Holding and KRAFT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coffee Holding position performs unexpectedly, KRAFT 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 KRAFT will offset losses from the drop in KRAFT's long position.| Coffee Holding vs. Seneca Foods Corp | Coffee Holding vs. J J Snack | Coffee Holding vs. Aryzta AG PK | Coffee Holding vs. Lifeway Foods |
| KRAFT vs. SunOpta | KRAFT vs. Proficient Auto Logistics, | KRAFT vs. Summit Materials | KRAFT vs. FitLife Brands, Common |
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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