Correlation Between PepsiCo and ENTERGY
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By analyzing existing cross correlation between PepsiCo and ENTERGY P NEW, you can compare the effects of market volatilities on PepsiCo and ENTERGY 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 ENTERGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of PepsiCo and ENTERGY.
Diversification Opportunities for PepsiCo and ENTERGY
Very weak diversification
The 3 months correlation between PepsiCo and ENTERGY is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding PepsiCo and ENTERGY P NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENTERGY P NEW 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 ENTERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENTERGY P NEW has no effect on the direction of PepsiCo i.e., PepsiCo and ENTERGY go up and down completely randomly.
Pair Corralation between PepsiCo and ENTERGY
Considering the 90-day investment horizon PepsiCo is expected to under-perform the ENTERGY. In addition to that, PepsiCo is 3.07 times more volatile than ENTERGY P NEW. It trades about -0.05 of its total potential returns per unit of risk. ENTERGY P NEW is currently generating about 0.12 per unit of volatility. If you would invest 9,682 in ENTERGY P NEW on September 2, 2024 and sell it today you would earn a total of 84.00 from holding ENTERGY P NEW or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
PepsiCo vs. ENTERGY P NEW
Performance |
| Timeline |
| PepsiCo |
| ENTERGY P NEW |
PepsiCo and ENTERGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PepsiCo and ENTERGY
The main advantage of trading using opposite PepsiCo and ENTERGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PepsiCo position performs unexpectedly, ENTERGY 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 ENTERGY will offset losses from the drop in ENTERGY's long position.| PepsiCo vs. Coca Cola Consolidated | PepsiCo vs. Monster Beverage Corp | PepsiCo vs. Celsius Holdings | PepsiCo vs. Keurig Dr Pepper |
| ENTERGY vs. AEP TEX INC | ENTERGY vs. US BANK NATIONAL | ENTERGY vs. International Business Machines | ENTERGY vs. Intel |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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