Correlation Between ALTRIA and Willamette Valley
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By analyzing existing cross correlation between ALTRIA GROUP INC and Willamette Valley Vineyards, you can compare the effects of market volatilities on ALTRIA and Willamette Valley 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 ALTRIA with a short position of Willamette Valley. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALTRIA and Willamette Valley.
Diversification Opportunities for ALTRIA and Willamette Valley
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ALTRIA and Willamette is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding ALTRIA GROUP INC and Willamette Valley Vineyards in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Willamette Valley and ALTRIA 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 ALTRIA GROUP INC are associated (or correlated) with Willamette Valley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Willamette Valley has no effect on the direction of ALTRIA i.e., ALTRIA and Willamette Valley go up and down completely randomly.
Pair Corralation between ALTRIA and Willamette Valley
Assuming the 90 days trading horizon ALTRIA GROUP INC is expected to under-perform the Willamette Valley. In addition to that, ALTRIA is 1.8 times more volatile than Willamette Valley Vineyards. It trades about -0.2 of its total potential returns per unit of risk. Willamette Valley Vineyards is currently generating about -0.1 per unit of volatility. If you would invest 334.00 in Willamette Valley Vineyards on September 12, 2024 and sell it today you would lose (9.00) from holding Willamette Valley Vineyards or give up 2.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
ALTRIA GROUP INC vs. Willamette Valley Vineyards
Performance |
| Timeline |
| ALTRIA GROUP INC |
| Willamette Valley |
ALTRIA and Willamette Valley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALTRIA and Willamette Valley
The main advantage of trading using opposite ALTRIA and Willamette Valley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALTRIA position performs unexpectedly, Willamette Valley 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 Willamette Valley will offset losses from the drop in Willamette Valley's long position.The idea behind ALTRIA GROUP INC and Willamette Valley Vineyards pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Willamette Valley vs. Andrew Peller Limited | Willamette Valley vs. Naked Wines plc | Willamette Valley vs. Willamette Valley Vineyards | Willamette Valley vs. Splash Beverage Group |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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