Correlation Between Keurig Dr and ATRenew
Can any of the company-specific risk be diversified away by investing in both Keurig Dr and ATRenew 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 ATRenew 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 ATRenew Inc DRC, you can compare the effects of market volatilities on Keurig Dr and ATRenew 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 ATRenew. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keurig Dr and ATRenew.
Diversification Opportunities for Keurig Dr and ATRenew
Good diversification
The 3 months correlation between Keurig and ATRenew is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and ATRenew Inc DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATRenew Inc DRC 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 ATRenew. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATRenew Inc DRC has no effect on the direction of Keurig Dr i.e., Keurig Dr and ATRenew go up and down completely randomly.
Pair Corralation between Keurig Dr and ATRenew
Considering the 90-day investment horizon Keurig Dr Pepper is expected to under-perform the ATRenew. But the stock apears to be less risky and, when comparing its historical volatility, Keurig Dr Pepper is 4.18 times less risky than ATRenew. The stock trades about -0.01 of its potential returns per unit of risk. The ATRenew Inc DRC is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 216.00 in ATRenew Inc DRC on August 28, 2024 and sell it today you would earn a total of 58.00 from holding ATRenew Inc DRC or generate 26.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keurig Dr Pepper vs. ATRenew Inc DRC
Performance |
| Timeline |
| Keurig Dr Pepper |
| ATRenew Inc DRC |
Keurig Dr and ATRenew Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keurig Dr and ATRenew
The main advantage of trading using opposite Keurig Dr and ATRenew positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keurig Dr position performs unexpectedly, ATRenew 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 ATRenew will offset losses from the drop in ATRenew's long position.| Keurig Dr vs. Celsius Holdings | Keurig Dr vs. Vita Coco | Keurig Dr vs. PepsiCo | Keurig Dr vs. Coca Cola Femsa SAB |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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