Correlation Between Keurig Dr and Femasys
Can any of the company-specific risk be diversified away by investing in both Keurig Dr and Femasys 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 Femasys 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 Femasys, you can compare the effects of market volatilities on Keurig Dr and Femasys 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 Femasys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keurig Dr and Femasys.
Diversification Opportunities for Keurig Dr and Femasys
Modest diversification
The 3 months correlation between Keurig and Femasys is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and Femasys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Femasys 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 Femasys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Femasys has no effect on the direction of Keurig Dr i.e., Keurig Dr and Femasys go up and down completely randomly.
Pair Corralation between Keurig Dr and Femasys
Considering the 90-day investment horizon Keurig Dr Pepper is expected to under-perform the Femasys. But the stock apears to be less risky and, when comparing its historical volatility, Keurig Dr Pepper is 3.2 times less risky than Femasys. The stock trades about -0.18 of its potential returns per unit of risk. The Femasys is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 109.00 in Femasys on September 5, 2024 and sell it today you would lose (1.00) from holding Femasys or give up 0.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keurig Dr Pepper vs. Femasys
Performance |
| Timeline |
| Keurig Dr Pepper |
| Femasys |
Keurig Dr and Femasys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keurig Dr and Femasys
The main advantage of trading using opposite Keurig Dr and Femasys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keurig Dr position performs unexpectedly, Femasys 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 Femasys will offset losses from the drop in Femasys' long position.| Keurig Dr vs. Celsius Holdings | Keurig Dr vs. Vita Coco | Keurig Dr vs. PepsiCo | Keurig Dr vs. Coca Cola Femsa SAB |
| Femasys vs. Baxter International | Femasys vs. West Pharmaceutical Services | Femasys vs. ResMed Inc | Femasys vs. ICU Medical |
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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