Correlation Between RBC Bearings and KRAFT
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By analyzing existing cross correlation between RBC Bearings Incorporated and KRAFT FOODS GROUP, you can compare the effects of market volatilities on RBC Bearings and KRAFT 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 RBC Bearings with a short position of KRAFT. Check out your portfolio center. Please also check ongoing floating volatility patterns of RBC Bearings and KRAFT.
Diversification Opportunities for RBC Bearings and KRAFT
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between RBC and KRAFT is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding RBC Bearings Incorporated and KRAFT FOODS GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KRAFT FOODS GROUP and RBC Bearings 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 RBC Bearings Incorporated are associated (or correlated) with KRAFT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KRAFT FOODS GROUP has no effect on the direction of RBC Bearings i.e., RBC Bearings and KRAFT go up and down completely randomly.
Pair Corralation between RBC Bearings and KRAFT
Considering the 90-day investment horizon RBC Bearings Incorporated is expected to generate 2.27 times more return on investment than KRAFT. However, RBC Bearings is 2.27 times more volatile than KRAFT FOODS GROUP. It trades about 0.15 of its potential returns per unit of risk. KRAFT FOODS GROUP is currently generating about 0.09 per unit of risk. If you would invest 32,008 in RBC Bearings Incorporated on September 12, 2024 and sell it today you would earn a total of 1,246 from holding RBC Bearings Incorporated or generate 3.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
RBC Bearings Incorporated vs. KRAFT FOODS GROUP
Performance |
| Timeline |
| RBC Bearings |
| KRAFT FOODS GROUP |
RBC Bearings and KRAFT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RBC Bearings and KRAFT
The main advantage of trading using opposite RBC Bearings and KRAFT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RBC Bearings position performs unexpectedly, KRAFT 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 KRAFT will offset losses from the drop in KRAFT's long position.| RBC Bearings vs. Kennametal | RBC Bearings vs. Snap On | RBC Bearings vs. Eastern Co | RBC Bearings vs. Lincoln Electric Holdings |
| KRAFT vs. Church Dwight | KRAFT vs. RBC Bearings Incorporated | KRAFT vs. Meiwu Technology Co | KRAFT vs. National Vision 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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