Correlation Between Starbucks and FLT Old
Can any of the company-specific risk be diversified away by investing in both Starbucks and FLT Old 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 Starbucks and FLT Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Starbucks and FLT Old, you can compare the effects of market volatilities on Starbucks and FLT Old 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 Starbucks with a short position of FLT Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Starbucks and FLT Old.
Diversification Opportunities for Starbucks and FLT Old
Pay attention - limited upside
The 3 months correlation between Starbucks and FLT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Starbucks and FLT Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FLT Old and Starbucks 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 Starbucks are associated (or correlated) with FLT Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FLT Old has no effect on the direction of Starbucks i.e., Starbucks and FLT Old go up and down completely randomly.
Pair Corralation between Starbucks and FLT Old
If you would invest 8,876 in Starbucks on October 20, 2024 and sell it today you would earn a total of 637.00 from holding Starbucks or generate 7.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Starbucks vs. FLT Old
Performance |
| Timeline |
| Starbucks |
| FLT Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Starbucks and FLT Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Starbucks and FLT Old
The main advantage of trading using opposite Starbucks and FLT Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Starbucks position performs unexpectedly, FLT Old 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 FLT Old will offset losses from the drop in FLT Old's long position.| Starbucks vs. Chipotle Mexican Grill | Starbucks vs. Dominos Pizza Common | Starbucks vs. Yum Brands | Starbucks vs. The Wendys Co |
| FLT Old vs. Gentex | FLT Old vs. Sphere Entertainment Co | FLT Old vs. Kingboard Chemical Holdings | FLT Old vs. Sensient Technologies |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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