Correlation Between WestRock and Good Natured
Can any of the company-specific risk be diversified away by investing in both WestRock and Good Natured 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 and Good Natured into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WestRock Co and good natured Products, you can compare the effects of market volatilities on WestRock and Good Natured 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 with a short position of Good Natured. Check out your portfolio center. Please also check ongoing floating volatility patterns of WestRock and Good Natured.
Diversification Opportunities for WestRock and Good Natured
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WestRock and Good is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding WestRock Co and good natured Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on good natured Products and WestRock 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 Co are associated (or correlated) with Good Natured. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of good natured Products has no effect on the direction of WestRock i.e., WestRock and Good Natured go up and down completely randomly.
Pair Corralation between WestRock and Good Natured
Considering the 90-day investment horizon WestRock Co is expected to generate 0.11 times more return on investment than Good Natured. However, WestRock Co is 8.86 times less risky than Good Natured. It trades about 0.15 of its potential returns per unit of risk. good natured Products is currently generating about 0.0 per unit of risk. If you would invest 3,468 in WestRock Co on August 25, 2024 and sell it today you would earn a total of 1,683 from holding WestRock Co or generate 48.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 63.7% |
| Values | Daily Returns |
WestRock Co vs. good natured Products
Performance |
| Timeline |
| WestRock |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| good natured Products |
WestRock and Good Natured Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WestRock and Good Natured
The main advantage of trading using opposite WestRock and Good Natured positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WestRock position performs unexpectedly, Good Natured 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 Good Natured will offset losses from the drop in Good Natured's long position.| WestRock vs. Packaging Corp of | WestRock vs. Sealed Air | WestRock vs. Fortive Corp | WestRock vs. LKQ Corporation |
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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