Correlation Between KRAFT and Old Dominion
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By analyzing existing cross correlation between KRAFT HEINZ FOODS and Old Dominion Freight, you can compare the effects of market volatilities on KRAFT and Old Dominion 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 KRAFT with a short position of Old Dominion. Check out your portfolio center. Please also check ongoing floating volatility patterns of KRAFT and Old Dominion.
Diversification Opportunities for KRAFT and Old Dominion
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between KRAFT and Old is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding KRAFT HEINZ FOODS and Old Dominion Freight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Dominion Freight and KRAFT 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 KRAFT HEINZ FOODS are associated (or correlated) with Old Dominion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Dominion Freight has no effect on the direction of KRAFT i.e., KRAFT and Old Dominion go up and down completely randomly.
Pair Corralation between KRAFT and Old Dominion
Assuming the 90 days trading horizon KRAFT HEINZ FOODS is expected to under-perform the Old Dominion. But the bond apears to be less risky and, when comparing its historical volatility, KRAFT HEINZ FOODS is 6.54 times less risky than Old Dominion. The bond trades about -0.09 of its potential returns per unit of risk. The Old Dominion Freight is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 19,377 in Old Dominion Freight on November 3, 2024 and sell it today you would lose (816.00) from holding Old Dominion Freight or give up 4.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
KRAFT HEINZ FOODS vs. Old Dominion Freight
Performance |
| Timeline |
| KRAFT HEINZ FOODS |
| Old Dominion Freight |
KRAFT and Old Dominion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KRAFT and Old Dominion
The main advantage of trading using opposite KRAFT and Old Dominion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KRAFT position performs unexpectedly, Old Dominion 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 Old Dominion will offset losses from the drop in Old Dominion's long position.| KRAFT vs. SunOpta | KRAFT vs. Proficient Auto Logistics, | KRAFT vs. Summit Materials | KRAFT vs. FitLife Brands, Common |
| Old Dominion vs. ArcBest Corp | Old Dominion vs. Marten Transport | Old Dominion vs. Werner Enterprises | Old Dominion vs. Knight Transportation |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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