Correlation Between Kandi Technologies and Westrock Coffee
Can any of the company-specific risk be diversified away by investing in both Kandi Technologies and Westrock Coffee 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 Kandi Technologies and Westrock Coffee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kandi Technologies Group and Westrock Coffee, you can compare the effects of market volatilities on Kandi Technologies and Westrock Coffee 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 Kandi Technologies with a short position of Westrock Coffee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kandi Technologies and Westrock Coffee.
Diversification Opportunities for Kandi Technologies and Westrock Coffee
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kandi and Westrock is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Kandi Technologies Group and Westrock Coffee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westrock Coffee and Kandi Technologies 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 Kandi Technologies Group are associated (or correlated) with Westrock Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westrock Coffee has no effect on the direction of Kandi Technologies i.e., Kandi Technologies and Westrock Coffee go up and down completely randomly.
Pair Corralation between Kandi Technologies and Westrock Coffee
Given the investment horizon of 90 days Kandi Technologies Group is expected to under-perform the Westrock Coffee. In addition to that, Kandi Technologies is 1.33 times more volatile than Westrock Coffee. It trades about -0.04 of its total potential returns per unit of risk. Westrock Coffee is currently generating about 0.28 per unit of volatility. If you would invest 662.00 in Westrock Coffee on August 31, 2024 and sell it today you would earn a total of 145.00 from holding Westrock Coffee or generate 21.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kandi Technologies Group vs. Westrock Coffee
Performance |
| Timeline |
| Kandi Technologies |
| Westrock Coffee |
Kandi Technologies and Westrock Coffee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kandi Technologies and Westrock Coffee
The main advantage of trading using opposite Kandi Technologies and Westrock Coffee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kandi Technologies position performs unexpectedly, Westrock Coffee 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 Westrock Coffee will offset losses from the drop in Westrock Coffee's long position.| Kandi Technologies vs. Hyliion Holdings Corp | Kandi Technologies vs. Foresight Autonomous Holdings | Kandi Technologies vs. Aeva Technologies | Kandi Technologies vs. Aeye Inc |
| Westrock Coffee vs. Coffee Holding Co | Westrock Coffee vs. Bridgford Foods | Westrock Coffee vs. John B Sanfilippo | Westrock Coffee vs. Treehouse Foods |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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