Correlation Between WestRock and Reynolds Consumer
Can any of the company-specific risk be diversified away by investing in both WestRock and Reynolds Consumer 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 Reynolds Consumer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WestRock Co and Reynolds Consumer Products, you can compare the effects of market volatilities on WestRock and Reynolds Consumer 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 Reynolds Consumer. Check out your portfolio center. Please also check ongoing floating volatility patterns of WestRock and Reynolds Consumer.
Diversification Opportunities for WestRock and Reynolds Consumer
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WestRock and Reynolds is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding WestRock Co and Reynolds Consumer Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reynolds Consumer 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 Reynolds Consumer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reynolds Consumer has no effect on the direction of WestRock i.e., WestRock and Reynolds Consumer go up and down completely randomly.
Pair Corralation between WestRock and Reynolds Consumer
If you would invest 5,151 in WestRock Co on August 24, 2024 and sell it today you would earn a total of 0.00 from holding WestRock Co or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
WestRock Co vs. Reynolds Consumer Products
Performance |
| Timeline |
| WestRock |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Reynolds Consumer |
WestRock and Reynolds Consumer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WestRock and Reynolds Consumer
The main advantage of trading using opposite WestRock and Reynolds Consumer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WestRock position performs unexpectedly, Reynolds Consumer 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 Reynolds Consumer will offset losses from the drop in Reynolds Consumer's long position.| WestRock vs. Packaging Corp of | WestRock vs. Sealed Air | WestRock vs. Fortive Corp | WestRock vs. LKQ Corporation |
| Reynolds Consumer vs. Greif Bros | Reynolds Consumer vs. Karat Packaging | Reynolds Consumer vs. Silgan Holdings | Reynolds Consumer vs. O I Glass |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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