Correlation Between Kellanova and Boeing
Can any of the company-specific risk be diversified away by investing in both Kellanova and Boeing 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 Kellanova and Boeing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kellanova and Boeing Co, you can compare the effects of market volatilities on Kellanova and Boeing 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 Kellanova with a short position of Boeing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kellanova and Boeing.
Diversification Opportunities for Kellanova and Boeing
Very weak diversification
The 3 months correlation between Kellanova and Boeing is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Kellanova and Boeing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boeing and Kellanova 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 Kellanova are associated (or correlated) with Boeing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boeing has no effect on the direction of Kellanova i.e., Kellanova and Boeing go up and down completely randomly.
Pair Corralation between Kellanova and Boeing
Taking into account the 90-day investment horizon Kellanova is expected to generate 3.11 times less return on investment than Boeing. But when comparing it to its historical volatility, Kellanova is 1.13 times less risky than Boeing. It trades about 0.05 of its potential returns per unit of risk. Boeing Co is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 5,360 in Boeing Co on November 2, 2024 and sell it today you would earn a total of 785.00 from holding Boeing Co or generate 14.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 12.96% |
| Values | Daily Returns |
Kellanova vs. Boeing Co
Performance |
| Timeline |
| Kellanova |
| Boeing |
Kellanova and Boeing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kellanova and Boeing
The main advantage of trading using opposite Kellanova and Boeing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kellanova position performs unexpectedly, Boeing 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 Boeing will offset losses from the drop in Boeing's long position.| Kellanova vs. Campbell Soup | Kellanova vs. ConAgra Foods | Kellanova vs. Hormel Foods | Kellanova vs. Kraft Heinz Co |
| Boeing vs. Kenon Holdings | Boeing vs. Codexis | Boeing vs. Suburban Propane Partners | Boeing vs. CenterPoint Energy |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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