Correlation Between Kellanova and Campbell Soup
Can any of the company-specific risk be diversified away by investing in both Kellanova and Campbell Soup 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 Campbell Soup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kellanova and Campbell Soup, you can compare the effects of market volatilities on Kellanova and Campbell Soup 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 Campbell Soup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kellanova and Campbell Soup.
Diversification Opportunities for Kellanova and Campbell Soup
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kellanova and Campbell is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Kellanova and Campbell Soup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Campbell Soup 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 Campbell Soup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Campbell Soup has no effect on the direction of Kellanova i.e., Kellanova and Campbell Soup go up and down completely randomly.
Pair Corralation between Kellanova and Campbell Soup
Taking into account the 90-day investment horizon Kellanova is expected to generate 0.1 times more return on investment than Campbell Soup. However, Kellanova is 10.07 times less risky than Campbell Soup. It trades about 0.2 of its potential returns per unit of risk. Campbell Soup is currently generating about -0.03 per unit of risk. If you would invest 8,178 in Kellanova on November 18, 2024 and sell it today you would earn a total of 48.00 from holding Kellanova or generate 0.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kellanova vs. Campbell Soup
Performance |
| Timeline |
| Kellanova |
| Campbell Soup |
Kellanova and Campbell Soup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kellanova and Campbell Soup
The main advantage of trading using opposite Kellanova and Campbell Soup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kellanova position performs unexpectedly, Campbell Soup 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 Campbell Soup will offset losses from the drop in Campbell Soup's long position.| Kellanova vs. Campbell Soup | Kellanova vs. ConAgra Foods | Kellanova vs. Hormel Foods | Kellanova vs. Kraft Heinz Co |
| Campbell Soup vs. General Mills | Campbell Soup vs. Hormel Foods | Campbell Soup vs. Kellanova | Campbell Soup vs. Lamb Weston Holdings |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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