Correlation Between Kikkoman and Real Good
Can any of the company-specific risk be diversified away by investing in both Kikkoman and Real Good 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 Kikkoman and Real Good into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kikkoman and Real Good Food, you can compare the effects of market volatilities on Kikkoman and Real Good 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 Kikkoman with a short position of Real Good. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kikkoman and Real Good.
Diversification Opportunities for Kikkoman and Real Good
Significant diversification
The 3 months correlation between Kikkoman and Real is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Kikkoman and Real Good Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Real Good Food and Kikkoman 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 Kikkoman are associated (or correlated) with Real Good. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Real Good Food has no effect on the direction of Kikkoman i.e., Kikkoman and Real Good go up and down completely randomly.
Pair Corralation between Kikkoman and Real Good
Assuming the 90 days horizon Kikkoman is expected to generate 0.26 times more return on investment than Real Good. However, Kikkoman is 3.92 times less risky than Real Good. It trades about -0.15 of its potential returns per unit of risk. Real Good Food is currently generating about -0.18 per unit of risk. If you would invest 1,150 in Kikkoman on August 31, 2024 and sell it today you would lose (95.00) from holding Kikkoman or give up 8.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kikkoman vs. Real Good Food
Performance |
| Timeline |
| Kikkoman |
| Real Good Food |
Kikkoman and Real Good Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kikkoman and Real Good
The main advantage of trading using opposite Kikkoman and Real Good positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kikkoman position performs unexpectedly, Real Good 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 Real Good will offset losses from the drop in Real Good's long position.| Kikkoman vs. Real Good Food | Kikkoman vs. Central Garden Pet | Kikkoman vs. John B Sanfilippo | Kikkoman vs. Nomad Foods |
| Real Good vs. Seneca Foods Corp | Real Good vs. Central Garden Pet | Real Good vs. Central Garden Pet | Real Good vs. Natures Sunshine Products |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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