Correlation Between SECURITAS and Fevertree Drinks
Can any of the company-specific risk be diversified away by investing in both SECURITAS and Fevertree Drinks 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 SECURITAS and Fevertree Drinks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SECURITAS B and Fevertree Drinks PLC, you can compare the effects of market volatilities on SECURITAS and Fevertree Drinks 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 SECURITAS with a short position of Fevertree Drinks. Check out your portfolio center. Please also check ongoing floating volatility patterns of SECURITAS and Fevertree Drinks.
Diversification Opportunities for SECURITAS and Fevertree Drinks
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SECURITAS and Fevertree is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding SECURITAS B and Fevertree Drinks PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fevertree Drinks PLC and SECURITAS 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 SECURITAS B are associated (or correlated) with Fevertree Drinks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fevertree Drinks PLC has no effect on the direction of SECURITAS i.e., SECURITAS and Fevertree Drinks go up and down completely randomly.
Pair Corralation between SECURITAS and Fevertree Drinks
Assuming the 90 days trading horizon SECURITAS B is expected to generate 0.36 times more return on investment than Fevertree Drinks. However, SECURITAS B is 2.74 times less risky than Fevertree Drinks. It trades about 0.03 of its potential returns per unit of risk. Fevertree Drinks PLC is currently generating about -0.08 per unit of risk. If you would invest 1,190 in SECURITAS B on October 24, 2024 and sell it today you would earn a total of 4.00 from holding SECURITAS B or generate 0.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SECURITAS B vs. Fevertree Drinks PLC
Performance |
| Timeline |
| SECURITAS B |
| Fevertree Drinks PLC |
SECURITAS and Fevertree Drinks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SECURITAS and Fevertree Drinks
The main advantage of trading using opposite SECURITAS and Fevertree Drinks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SECURITAS position performs unexpectedly, Fevertree Drinks 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 Fevertree Drinks will offset losses from the drop in Fevertree Drinks' long position.| SECURITAS vs. GameStop Corp | SECURITAS vs. Media and Games | SECURITAS vs. MOVIE GAMES SA | SECURITAS vs. SEI INVESTMENTS |
| Fevertree Drinks vs. ARISTOCRAT LEISURE | Fevertree Drinks vs. LG Display Co | Fevertree Drinks vs. Pembina Pipeline Corp | Fevertree Drinks vs. Luckin Coffee |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |