Correlation Between Nichirei and Kellanova
Can any of the company-specific risk be diversified away by investing in both Nichirei and Kellanova 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 Nichirei and Kellanova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nichirei and Kellanova, you can compare the effects of market volatilities on Nichirei and Kellanova 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 Nichirei with a short position of Kellanova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nichirei and Kellanova.
Diversification Opportunities for Nichirei and Kellanova
Pay attention - limited upside
The 3 months correlation between Nichirei and Kellanova is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nichirei and Kellanova in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kellanova and Nichirei 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 Nichirei are associated (or correlated) with Kellanova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kellanova has no effect on the direction of Nichirei i.e., Nichirei and Kellanova go up and down completely randomly.
Pair Corralation between Nichirei and Kellanova
Assuming the 90 days horizon Nichirei is expected to generate 1.18 times less return on investment than Kellanova. In addition to that, Nichirei is 1.18 times more volatile than Kellanova. It trades about 0.1 of its total potential returns per unit of risk. Kellanova is currently generating about 0.14 per unit of volatility. If you would invest 7,217 in Kellanova on November 3, 2024 and sell it today you would earn a total of 956.00 from holding Kellanova or generate 13.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 97.66% |
| Values | Daily Returns |
Nichirei vs. Kellanova
Performance |
| Timeline |
| Nichirei |
| Kellanova |
Nichirei and Kellanova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nichirei and Kellanova
The main advantage of trading using opposite Nichirei and Kellanova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nichirei position performs unexpectedly, Kellanova 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 Kellanova will offset losses from the drop in Kellanova's long position.| Nichirei vs. Kellanova | Nichirei vs. General Mills | Nichirei vs. Campbell Soup | Nichirei vs. Kraft Heinz Co |
| Kellanova vs. Campbell Soup | Kellanova vs. ConAgra Foods | Kellanova vs. Hormel Foods | Kellanova vs. Kraft Heinz Co |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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