Correlation Between ATRenew and Keurig Dr
Can any of the company-specific risk be diversified away by investing in both ATRenew and Keurig Dr 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 ATRenew and Keurig Dr into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATRenew Inc DRC and Keurig Dr Pepper, you can compare the effects of market volatilities on ATRenew and Keurig Dr 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 ATRenew with a short position of Keurig Dr. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATRenew and Keurig Dr.
Diversification Opportunities for ATRenew and Keurig Dr
Good diversification
The 3 months correlation between ATRenew and Keurig is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding ATRenew Inc DRC and Keurig Dr Pepper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keurig Dr Pepper and ATRenew 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 ATRenew Inc DRC are associated (or correlated) with Keurig Dr. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keurig Dr Pepper has no effect on the direction of ATRenew i.e., ATRenew and Keurig Dr go up and down completely randomly.
Pair Corralation between ATRenew and Keurig Dr
Given the investment horizon of 90 days ATRenew Inc DRC is expected to generate 4.41 times more return on investment than Keurig Dr. However, ATRenew is 4.41 times more volatile than Keurig Dr Pepper. It trades about 0.11 of its potential returns per unit of risk. Keurig Dr Pepper is currently generating about 0.03 per unit of risk. If you would invest 108.00 in ATRenew Inc DRC on August 28, 2024 and sell it today you would earn a total of 166.00 from holding ATRenew Inc DRC or generate 153.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATRenew Inc DRC vs. Keurig Dr Pepper
Performance |
| Timeline |
| ATRenew Inc DRC |
| Keurig Dr Pepper |
ATRenew and Keurig Dr Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATRenew and Keurig Dr
The main advantage of trading using opposite ATRenew and Keurig Dr positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATRenew position performs unexpectedly, Keurig Dr 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 Keurig Dr will offset losses from the drop in Keurig Dr's long position.The idea behind ATRenew Inc DRC and Keurig Dr Pepper 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.| Keurig Dr vs. Celsius Holdings | Keurig Dr vs. Vita Coco | Keurig Dr vs. PepsiCo | Keurig Dr vs. Coca Cola Femsa SAB |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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