Correlation Between Kellanova and CHS
Can any of the company-specific risk be diversified away by investing in both Kellanova and CHS 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 CHS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kellanova and CHS Inc CP, you can compare the effects of market volatilities on Kellanova and CHS 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 CHS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kellanova and CHS.
Diversification Opportunities for Kellanova and CHS
Very good diversification
The 3 months correlation between Kellanova and CHS is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Kellanova and CHS Inc CP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHS Inc CP 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 CHS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHS Inc CP has no effect on the direction of Kellanova i.e., Kellanova and CHS go up and down completely randomly.
Pair Corralation between Kellanova and CHS
Taking into account the 90-day investment horizon Kellanova is expected to generate 1.55 times more return on investment than CHS. However, Kellanova is 1.55 times more volatile than CHS Inc CP. It trades about 0.12 of its potential returns per unit of risk. CHS Inc CP is currently generating about -0.01 per unit of risk. If you would invest 5,187 in Kellanova on September 14, 2024 and sell it today you would earn a total of 2,890 from holding Kellanova or generate 55.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Kellanova vs. CHS Inc CP
Performance |
| Timeline |
| Kellanova |
| CHS Inc CP |
Kellanova and CHS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kellanova and CHS
The main advantage of trading using opposite Kellanova and CHS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kellanova position performs unexpectedly, CHS 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 CHS will offset losses from the drop in CHS's long position.The idea behind Kellanova and CHS Inc CP pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |