Correlation Between Kering SA and BOSTON BEER
Can any of the company-specific risk be diversified away by investing in both Kering SA and BOSTON BEER 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 Kering SA and BOSTON BEER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kering SA and BOSTON BEER A , you can compare the effects of market volatilities on Kering SA and BOSTON BEER 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 Kering SA with a short position of BOSTON BEER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kering SA and BOSTON BEER.
Diversification Opportunities for Kering SA and BOSTON BEER
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kering and BOSTON is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Kering SA and BOSTON BEER A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOSTON BEER A and Kering SA 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 Kering SA are associated (or correlated) with BOSTON BEER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOSTON BEER A has no effect on the direction of Kering SA i.e., Kering SA and BOSTON BEER go up and down completely randomly.
Pair Corralation between Kering SA and BOSTON BEER
Assuming the 90 days trading horizon Kering SA is expected to under-perform the BOSTON BEER. But the stock apears to be less risky and, when comparing its historical volatility, Kering SA is 1.01 times less risky than BOSTON BEER. The stock trades about -0.05 of its potential returns per unit of risk. The BOSTON BEER A is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 31,530 in BOSTON BEER A on September 14, 2024 and sell it today you would lose (1,990) from holding BOSTON BEER A or give up 6.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kering SA vs. BOSTON BEER A
Performance |
| Timeline |
| Kering SA |
| BOSTON BEER A |
Kering SA and BOSTON BEER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kering SA and BOSTON BEER
The main advantage of trading using opposite Kering SA and BOSTON BEER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kering SA position performs unexpectedly, BOSTON BEER 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 BOSTON BEER will offset losses from the drop in BOSTON BEER's long position.| Kering SA vs. BOSTON BEER A | Kering SA vs. Fevertree Drinks PLC | Kering SA vs. QBE Insurance Group | Kering SA vs. JSC Halyk bank |
| BOSTON BEER vs. Apple Inc | BOSTON BEER vs. Apple Inc | BOSTON BEER vs. Apple Inc | BOSTON BEER vs. Apple Inc |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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