Correlation Between Westinghouse Air and KRAFT
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By analyzing existing cross correlation between Westinghouse Air Brake and KRAFT FOODS GROUP, you can compare the effects of market volatilities on Westinghouse Air and KRAFT 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 Westinghouse Air with a short position of KRAFT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westinghouse Air and KRAFT.
Diversification Opportunities for Westinghouse Air and KRAFT
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Westinghouse and KRAFT is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Westinghouse Air Brake and KRAFT FOODS GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KRAFT FOODS GROUP and Westinghouse Air 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 Westinghouse Air Brake are associated (or correlated) with KRAFT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KRAFT FOODS GROUP has no effect on the direction of Westinghouse Air i.e., Westinghouse Air and KRAFT go up and down completely randomly.
Pair Corralation between Westinghouse Air and KRAFT
Considering the 90-day investment horizon Westinghouse Air Brake is expected to generate 1.8 times more return on investment than KRAFT. However, Westinghouse Air is 1.8 times more volatile than KRAFT FOODS GROUP. It trades about 0.29 of its potential returns per unit of risk. KRAFT FOODS GROUP is currently generating about 0.07 per unit of risk. If you would invest 18,665 in Westinghouse Air Brake on September 2, 2024 and sell it today you would earn a total of 1,397 from holding Westinghouse Air Brake or generate 7.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Westinghouse Air Brake vs. KRAFT FOODS GROUP
Performance |
| Timeline |
| Westinghouse Air Brake |
| KRAFT FOODS GROUP |
Westinghouse Air and KRAFT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westinghouse Air and KRAFT
The main advantage of trading using opposite Westinghouse Air and KRAFT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westinghouse Air position performs unexpectedly, KRAFT 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 KRAFT will offset losses from the drop in KRAFT's long position.| Westinghouse Air vs. Greenbrier Companies | Westinghouse Air vs. LB Foster | Westinghouse Air vs. CSX Corporation | Westinghouse Air vs. Norfolk Southern |
| KRAFT vs. ChampionX | KRAFT vs. Simpson Manufacturing | KRAFT vs. Kite Realty Group | KRAFT vs. Upper Street Marketing |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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