Correlation Between Kellogg and Lenox Pasifik
Can any of the company-specific risk be diversified away by investing in both Kellogg and Lenox Pasifik 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 Kellogg and Lenox Pasifik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kellogg Company and Lenox Pasifik Investama, you can compare the effects of market volatilities on Kellogg and Lenox Pasifik 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 Kellogg with a short position of Lenox Pasifik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kellogg and Lenox Pasifik.
Diversification Opportunities for Kellogg and Lenox Pasifik
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kellogg and Lenox is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Kellogg Company and Lenox Pasifik Investama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lenox Pasifik Investama and Kellogg 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 Kellogg Company are associated (or correlated) with Lenox Pasifik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lenox Pasifik Investama has no effect on the direction of Kellogg i.e., Kellogg and Lenox Pasifik go up and down completely randomly.
Pair Corralation between Kellogg and Lenox Pasifik
Assuming the 90 days horizon Kellogg is expected to generate 30.35 times less return on investment than Lenox Pasifik. But when comparing it to its historical volatility, Kellogg Company is 22.95 times less risky than Lenox Pasifik. It trades about 0.05 of its potential returns per unit of risk. Lenox Pasifik Investama is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 0.05 in Lenox Pasifik Investama on October 19, 2024 and sell it today you would earn a total of 0.20 from holding Lenox Pasifik Investama or generate 400.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kellogg Company vs. Lenox Pasifik Investama
Performance |
| Timeline |
| Kellogg Company |
| Lenox Pasifik Investama |
Kellogg and Lenox Pasifik Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kellogg and Lenox Pasifik
The main advantage of trading using opposite Kellogg and Lenox Pasifik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kellogg position performs unexpectedly, Lenox Pasifik 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 Lenox Pasifik will offset losses from the drop in Lenox Pasifik's long position.| Kellogg vs. Elmos Semiconductor SE | Kellogg vs. Ribbon Communications | Kellogg vs. TOREX SEMICONDUCTOR LTD | Kellogg vs. TELECOM ITALIA |
| Lenox Pasifik vs. Gol Intelligent Airlines | Lenox Pasifik vs. American Airlines Group | Lenox Pasifik vs. ScanSource | Lenox Pasifik vs. CRISPR Therapeutics AG |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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