Correlation Between PepsiCo and Wang Lee
Can any of the company-specific risk be diversified away by investing in both PepsiCo and Wang Lee 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 Wang Lee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PepsiCo and Wang Lee Group,, you can compare the effects of market volatilities on PepsiCo and Wang Lee 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 Wang Lee. Check out your portfolio center. Please also check ongoing floating volatility patterns of PepsiCo and Wang Lee.
Diversification Opportunities for PepsiCo and Wang Lee
Pay attention - limited upside
The 3 months correlation between PepsiCo and Wang is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding PepsiCo and Wang Lee Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wang Lee Group, 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 Wang Lee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wang Lee Group, has no effect on the direction of PepsiCo i.e., PepsiCo and Wang Lee go up and down completely randomly.
Pair Corralation between PepsiCo and Wang Lee
Considering the 90-day investment horizon PepsiCo is expected to under-perform the Wang Lee. But the stock apears to be less risky and, when comparing its historical volatility, PepsiCo is 10.34 times less risky than Wang Lee. The stock trades about -0.3 of its potential returns per unit of risk. The Wang Lee Group, is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 218.00 in Wang Lee Group, on August 24, 2024 and sell it today you would earn a total of 174.00 from holding Wang Lee Group, or generate 79.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PepsiCo vs. Wang Lee Group,
Performance |
| Timeline |
| PepsiCo |
| Wang Lee Group, |
PepsiCo and Wang Lee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PepsiCo and Wang Lee
The main advantage of trading using opposite PepsiCo and Wang Lee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PepsiCo position performs unexpectedly, Wang Lee 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 Wang Lee will offset losses from the drop in Wang Lee's long position.| PepsiCo vs. Monster Beverage Corp | PepsiCo vs. Celsius Holdings | PepsiCo vs. Coca Cola Femsa SAB | PepsiCo vs. Vita Coco |
| Wang Lee vs. PepsiCo | Wang Lee vs. National Beverage Corp | Wang Lee vs. Willamette Valley Vineyards | Wang Lee vs. Celsius Holdings |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| CEOs Directory Screen CEOs from public companies around the world | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |