Correlation Between Boston Beer and Energy
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By analyzing existing cross correlation between Boston Beer and Energy Transfer 7125, you can compare the effects of market volatilities on Boston Beer and Energy 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 Boston Beer with a short position of Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Beer and Energy.
Diversification Opportunities for Boston Beer and Energy
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boston and Energy is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Boston Beer and Energy Transfer 7125 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Transfer 7125 and Boston Beer 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 Boston Beer are associated (or correlated) with Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Transfer 7125 has no effect on the direction of Boston Beer i.e., Boston Beer and Energy go up and down completely randomly.
Pair Corralation between Boston Beer and Energy
Considering the 90-day investment horizon Boston Beer is expected to generate 2.73 times less return on investment than Energy. But when comparing it to its historical volatility, Boston Beer is 3.89 times less risky than Energy. It trades about 0.05 of its potential returns per unit of risk. Energy Transfer 7125 is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 10,200 in Energy Transfer 7125 on September 12, 2024 and sell it today you would earn a total of 100.00 from holding Energy Transfer 7125 or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Boston Beer vs. Energy Transfer 7125
Performance |
| Timeline |
| Boston Beer |
| Energy Transfer 7125 |
Boston Beer and Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Beer and Energy
The main advantage of trading using opposite Boston Beer and Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Beer position performs unexpectedly, Energy 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 Energy will offset losses from the drop in Energy's long position.| Boston Beer vs. Anheuser Busch Inbev | Boston Beer vs. Molson Coors Beverage | Boston Beer vs. Heineken NV | Boston Beer vs. Ambev SA ADR |
| Energy vs. Diamond Estates Wines | Energy vs. Boston Beer | Energy vs. Ambev SA ADR | Energy vs. High Performance Beverages |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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