Correlation Between Keurig Dr and Aegon Funding
Can any of the company-specific risk be diversified away by investing in both Keurig Dr and Aegon Funding 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 Keurig Dr and Aegon Funding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Keurig Dr Pepper and Aegon Funding, you can compare the effects of market volatilities on Keurig Dr and Aegon Funding 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 Keurig Dr with a short position of Aegon Funding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keurig Dr and Aegon Funding.
Diversification Opportunities for Keurig Dr and Aegon Funding
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Keurig and Aegon is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and Aegon Funding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegon Funding and Keurig Dr 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 Keurig Dr Pepper are associated (or correlated) with Aegon Funding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegon Funding has no effect on the direction of Keurig Dr i.e., Keurig Dr and Aegon Funding go up and down completely randomly.
Pair Corralation between Keurig Dr and Aegon Funding
Considering the 90-day investment horizon Keurig Dr Pepper is expected to generate 1.3 times more return on investment than Aegon Funding. However, Keurig Dr is 1.3 times more volatile than Aegon Funding. It trades about 0.02 of its potential returns per unit of risk. Aegon Funding is currently generating about 0.03 per unit of risk. If you would invest 3,020 in Keurig Dr Pepper on August 31, 2024 and sell it today you would earn a total of 245.00 from holding Keurig Dr Pepper or generate 8.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keurig Dr Pepper vs. Aegon Funding
Performance |
| Timeline |
| Keurig Dr Pepper |
| Aegon Funding |
Keurig Dr and Aegon Funding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keurig Dr and Aegon Funding
The main advantage of trading using opposite Keurig Dr and Aegon Funding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keurig Dr position performs unexpectedly, Aegon Funding 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 Aegon Funding will offset losses from the drop in Aegon Funding's long position.| Keurig Dr vs. Monster Beverage Corp | Keurig Dr vs. RLJ Lodging Trust | Keurig Dr vs. Aquagold International | Keurig Dr vs. Stepstone Group |
| Aegon Funding vs. Petroleo Brasileiro Petrobras | Aegon Funding vs. Equinor ASA ADR | Aegon Funding vs. Eni SpA ADR | Aegon Funding vs. YPF Sociedad Anonima |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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