Correlation Between Vistra Energy and Britvic PLC
Can any of the company-specific risk be diversified away by investing in both Vistra Energy and Britvic PLC 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 Vistra Energy and Britvic PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vistra Energy Corp and Britvic PLC ADR, you can compare the effects of market volatilities on Vistra Energy and Britvic PLC 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 Vistra Energy with a short position of Britvic PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vistra Energy and Britvic PLC.
Diversification Opportunities for Vistra Energy and Britvic PLC
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vistra and Britvic is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Vistra Energy Corp and Britvic PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Britvic PLC ADR and Vistra Energy 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 Vistra Energy Corp are associated (or correlated) with Britvic PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Britvic PLC ADR has no effect on the direction of Vistra Energy i.e., Vistra Energy and Britvic PLC go up and down completely randomly.
Pair Corralation between Vistra Energy and Britvic PLC
Considering the 90-day investment horizon Vistra Energy Corp is expected to generate 2.16 times more return on investment than Britvic PLC. However, Vistra Energy is 2.16 times more volatile than Britvic PLC ADR. It trades about 0.14 of its potential returns per unit of risk. Britvic PLC ADR is currently generating about 0.08 per unit of risk. If you would invest 2,219 in Vistra Energy Corp on November 2, 2024 and sell it today you would earn a total of 14,934 from holding Vistra Energy Corp or generate 673.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Vistra Energy Corp vs. Britvic PLC ADR
Performance |
| Timeline |
| Vistra Energy Corp |
| Britvic PLC ADR |
Vistra Energy and Britvic PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vistra Energy and Britvic PLC
The main advantage of trading using opposite Vistra Energy and Britvic PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vistra Energy position performs unexpectedly, Britvic PLC 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 Britvic PLC will offset losses from the drop in Britvic PLC's long position.| Vistra Energy vs. Pampa Energia SA | Vistra Energy vs. TransAlta Corp | Vistra Energy vs. Kenon Holdings | Vistra Energy vs. NRG Energy |
| Britvic PLC vs. Flow Beverage Corp | Britvic PLC vs. Barfresh Food Group | Britvic PLC vs. Fbec Worldwide | Britvic PLC vs. Greene Concepts |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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