Correlation Between RLX Technology and Keurig Dr
Can any of the company-specific risk be diversified away by investing in both RLX Technology 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 RLX Technology and Keurig Dr into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RLX Technology and Keurig Dr Pepper, you can compare the effects of market volatilities on RLX Technology 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 RLX Technology with a short position of Keurig Dr. Check out your portfolio center. Please also check ongoing floating volatility patterns of RLX Technology and Keurig Dr.
Diversification Opportunities for RLX Technology and Keurig Dr
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between RLX and Keurig is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding RLX Technology 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 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 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 RLX Technology i.e., RLX Technology and Keurig Dr go up and down completely randomly.
Pair Corralation between RLX Technology and Keurig Dr
Considering the 90-day investment horizon RLX Technology is expected to generate 1.68 times more return on investment than Keurig Dr. However, RLX Technology is 1.68 times more volatile than Keurig Dr Pepper. It trades about 0.15 of its potential returns per unit of risk. Keurig Dr Pepper is currently generating about -0.09 per unit of risk. If you would invest 170.00 in RLX Technology on August 28, 2024 and sell it today you would earn a total of 13.00 from holding RLX Technology or generate 7.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
RLX Technology vs. Keurig Dr Pepper
Performance |
| Timeline |
| RLX Technology |
| Keurig Dr Pepper |
RLX Technology and Keurig Dr Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RLX Technology and Keurig Dr
The main advantage of trading using opposite RLX Technology and Keurig Dr positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RLX Technology 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.| RLX Technology vs. Bellring Brands LLC | RLX Technology vs. Ingredion Incorporated | RLX Technology vs. Nomad Foods | RLX Technology vs. Simply Good Foods |
| 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 Stocks Directory module to find actively traded stocks across global markets.
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