Correlation Between Westrock Coffee and Affiliated Resources
Can any of the company-specific risk be diversified away by investing in both Westrock Coffee and Affiliated Resources 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 Westrock Coffee and Affiliated Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westrock Coffee and Affiliated Resources Corp, you can compare the effects of market volatilities on Westrock Coffee and Affiliated Resources 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 Westrock Coffee with a short position of Affiliated Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westrock Coffee and Affiliated Resources.
Diversification Opportunities for Westrock Coffee and Affiliated Resources
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Westrock and Affiliated is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Westrock Coffee and Affiliated Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Affiliated Resources Corp and Westrock Coffee 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 Westrock Coffee are associated (or correlated) with Affiliated Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Affiliated Resources Corp has no effect on the direction of Westrock Coffee i.e., Westrock Coffee and Affiliated Resources go up and down completely randomly.
Pair Corralation between Westrock Coffee and Affiliated Resources
Given the investment horizon of 90 days Westrock Coffee is expected to generate 0.9 times more return on investment than Affiliated Resources. However, Westrock Coffee is 1.12 times less risky than Affiliated Resources. It trades about 0.17 of its potential returns per unit of risk. Affiliated Resources Corp is currently generating about -0.04 per unit of risk. If you would invest 689.00 in Westrock Coffee on September 4, 2024 and sell it today you would earn a total of 88.00 from holding Westrock Coffee or generate 12.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Westrock Coffee vs. Affiliated Resources Corp
Performance |
| Timeline |
| Westrock Coffee |
| Affiliated Resources Corp |
Westrock Coffee and Affiliated Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westrock Coffee and Affiliated Resources
The main advantage of trading using opposite Westrock Coffee and Affiliated Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westrock Coffee position performs unexpectedly, Affiliated Resources 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 Affiliated Resources will offset losses from the drop in Affiliated Resources' long position.| Westrock Coffee vs. Coffee Holding Co | Westrock Coffee vs. Bridgford Foods | Westrock Coffee vs. John B Sanfilippo | Westrock Coffee vs. Treehouse Foods |
| Affiliated Resources vs. Westrock Coffee | Affiliated Resources vs. National Beverage Corp | Affiliated Resources vs. Oatly Group AB | Affiliated Resources vs. Thai Beverage PCL |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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