Correlation Between Vodka Brands and LEGGETT
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By analyzing existing cross correlation between Vodka Brands Corp and LEGGETT PLATT INC, you can compare the effects of market volatilities on Vodka Brands and LEGGETT 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 Vodka Brands with a short position of LEGGETT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vodka Brands and LEGGETT.
Diversification Opportunities for Vodka Brands and LEGGETT
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Vodka and LEGGETT is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Vodka Brands Corp and LEGGETT PLATT INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LEGGETT PLATT INC and Vodka Brands 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 Vodka Brands Corp are associated (or correlated) with LEGGETT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LEGGETT PLATT INC has no effect on the direction of Vodka Brands i.e., Vodka Brands and LEGGETT go up and down completely randomly.
Pair Corralation between Vodka Brands and LEGGETT
Given the investment horizon of 90 days Vodka Brands Corp is expected to generate 5.28 times more return on investment than LEGGETT. However, Vodka Brands is 5.28 times more volatile than LEGGETT PLATT INC. It trades about 0.22 of its potential returns per unit of risk. LEGGETT PLATT INC is currently generating about -0.03 per unit of risk. If you would invest 99.00 in Vodka Brands Corp on September 10, 2024 and sell it today you would earn a total of 13.00 from holding Vodka Brands Corp or generate 13.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
Vodka Brands Corp vs. LEGGETT PLATT INC
Performance |
| Timeline |
| Vodka Brands Corp |
| LEGGETT PLATT INC |
Vodka Brands and LEGGETT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vodka Brands and LEGGETT
The main advantage of trading using opposite Vodka Brands and LEGGETT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vodka Brands position performs unexpectedly, LEGGETT 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 LEGGETT will offset losses from the drop in LEGGETT's long position.| Vodka Brands vs. Brown Forman | Vodka Brands vs. Brown Forman | Vodka Brands vs. Eastside Distilling | Vodka Brands vs. Diageo PLC ADR |
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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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