Correlation Between BBB Foods and KWG Group
Can any of the company-specific risk be diversified away by investing in both BBB Foods and KWG Group 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 BBB Foods and KWG Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BBB Foods and KWG Group Holdings, you can compare the effects of market volatilities on BBB Foods and KWG Group 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 BBB Foods with a short position of KWG Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of BBB Foods and KWG Group.
Diversification Opportunities for BBB Foods and KWG Group
Pay attention - limited upside
The 3 months correlation between BBB and KWG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BBB Foods and KWG Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KWG Group Holdings and BBB Foods 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 BBB Foods are associated (or correlated) with KWG Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KWG Group Holdings has no effect on the direction of BBB Foods i.e., BBB Foods and KWG Group go up and down completely randomly.
Pair Corralation between BBB Foods and KWG Group
If you would invest 2,158 in BBB Foods on September 15, 2024 and sell it today you would earn a total of 715.00 from holding BBB Foods or generate 33.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
BBB Foods vs. KWG Group Holdings
Performance |
| Timeline |
| BBB Foods |
| KWG Group Holdings |
BBB Foods and KWG Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BBB Foods and KWG Group
The main advantage of trading using opposite BBB Foods and KWG Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BBB Foods position performs unexpectedly, KWG Group 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 KWG Group will offset losses from the drop in KWG Group's long position.| BBB Foods vs. Costco Wholesale Corp | BBB Foods vs. BJs Wholesale Club | BBB Foods vs. Dollar Tree | BBB Foods vs. Dollar General |
| KWG Group vs. BBB Foods | KWG Group vs. Gentex | KWG Group vs. Magna International | KWG Group vs. Where Food Comes |
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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