Correlation Between RLX Technology and Anheuser Busch
Can any of the company-specific risk be diversified away by investing in both RLX Technology and Anheuser Busch 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 RLX Technology and Anheuser Busch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RLX Technology and Anheuser Busch Inbev, you can compare the effects of market volatilities on RLX Technology and Anheuser Busch 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 RLX Technology with a short position of Anheuser Busch. Check out your portfolio center. Please also check ongoing floating volatility patterns of RLX Technology and Anheuser Busch.
Diversification Opportunities for RLX Technology and Anheuser Busch
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between RLX and Anheuser is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding RLX Technology and Anheuser Busch Inbev in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anheuser Busch Inbev and RLX Technology 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 RLX Technology are associated (or correlated) with Anheuser Busch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anheuser Busch Inbev has no effect on the direction of RLX Technology i.e., RLX Technology and Anheuser Busch go up and down completely randomly.
Pair Corralation between RLX Technology and Anheuser Busch
Considering the 90-day investment horizon RLX Technology is expected to generate 2.44 times more return on investment than Anheuser Busch. However, RLX Technology is 2.44 times more volatile than Anheuser Busch Inbev. It trades about 0.02 of its potential returns per unit of risk. Anheuser Busch Inbev is currently generating about -0.01 per unit of risk. If you would invest 178.00 in RLX Technology on September 12, 2024 and sell it today you would earn a total of 13.00 from holding RLX Technology or generate 7.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
RLX Technology vs. Anheuser Busch Inbev
Performance |
| Timeline |
| RLX Technology |
| Anheuser Busch Inbev |
RLX Technology and Anheuser Busch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RLX Technology and Anheuser Busch
The main advantage of trading using opposite RLX Technology and Anheuser Busch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RLX Technology position performs unexpectedly, Anheuser Busch 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 Anheuser Busch will offset losses from the drop in Anheuser Busch's long position.| RLX Technology vs. Universal | RLX Technology vs. Imperial Brands PLC | RLX Technology vs. British American Tobacco | RLX Technology vs. Philip Morris International |
| Anheuser Busch vs. Boston Beer | Anheuser Busch vs. Molson Coors Beverage | Anheuser Busch vs. Heineken NV | Anheuser Busch vs. Ambev SA ADR |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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