Correlation Between PepsiCo and TenX Keane

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Can any of the company-specific risk be diversified away by investing in both PepsiCo and TenX Keane 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 PepsiCo and TenX Keane into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PepsiCo and TenX Keane Acquisition, you can compare the effects of market volatilities on PepsiCo and TenX Keane 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 PepsiCo with a short position of TenX Keane. Check out your portfolio center. Please also check ongoing floating volatility patterns of PepsiCo and TenX Keane.

Diversification Opportunities for PepsiCo and TenX Keane

-0.31
  Correlation Coefficient

Very good diversification

The 3 months correlation between PepsiCo and TenX is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding PepsiCo and TenX Keane Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TenX Keane Acquisition and PepsiCo 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 PepsiCo are associated (or correlated) with TenX Keane. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TenX Keane Acquisition has no effect on the direction of PepsiCo i.e., PepsiCo and TenX Keane go up and down completely randomly.

Pair Corralation between PepsiCo and TenX Keane

Considering the 90-day investment horizon PepsiCo is expected to generate 7940.0 times less return on investment than TenX Keane. But when comparing it to its historical volatility, PepsiCo is 17.56 times less risky than TenX Keane. It trades about 0.0 of its potential returns per unit of risk. TenX Keane Acquisition is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,121  in TenX Keane Acquisition on September 14, 2024 and sell it today you would lose (1,121) from holding TenX Keane Acquisition or give up 100.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy68.4%
ValuesDaily Returns

PepsiCo  vs.  TenX Keane Acquisition

 Performance 
       Timeline  
PepsiCo 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days PepsiCo has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.
TenX Keane Acquisition 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days TenX Keane Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking signals, TenX Keane is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

PepsiCo and TenX Keane Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with PepsiCo and TenX Keane

The main advantage of trading using opposite PepsiCo and TenX Keane positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PepsiCo position performs unexpectedly, TenX Keane 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 TenX Keane will offset losses from the drop in TenX Keane's long position.
The idea behind PepsiCo and TenX Keane Acquisition pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.

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