Correlation Between Keurig Dr and Asure Software

Can any of the company-specific risk be diversified away by investing in both Keurig Dr and Asure Software 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 Keurig Dr and Asure Software into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Keurig Dr Pepper and Asure Software, you can compare the effects of market volatilities on Keurig Dr and Asure Software 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 Keurig Dr with a short position of Asure Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keurig Dr and Asure Software.

Diversification Opportunities for Keurig Dr and Asure Software

-0.23

Correlation Coefficient

Keurig Dr  Asure Software

Very good diversification

The 3 months correlation between Keurig and Asure is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and Asure Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asure Software and Keurig Dr 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 Keurig Dr Pepper are associated (or correlated) with Asure Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asure Software has no effect on the direction of Keurig Dr i.e., Keurig Dr and Asure Software go up and down completely randomly.

Pair Corralation between Keurig Dr and Asure Software

Considering the 90-day investment horizon Keurig Dr Pepper is expected to under-perform the Asure Software. But the stock apears to be less risky and, when comparing its historical volatility, Keurig Dr Pepper is 2.49 times less risky than Asure Software. The stock trades about -0.19 of its potential returns per unit of risk. The Asure Software is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  933.00  in Asure Software on September 21, 2024 and sell it today you would lose (19.00) from holding Asure Software or give up 2.04% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Keurig Dr Pepper  vs.  Asure Software

Keurig Dr Pepper

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Keurig Dr Pepper has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Asure Software

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Asure Software has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Asure Software is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Keurig Dr and Asure Software

The main advantage of trading using opposite Keurig Dr and Asure Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keurig Dr position performs unexpectedly, Asure Software 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 Asure Software will offset losses from the drop in Asure Software's long position.

The idea behind Keurig Dr Pepper and Asure Software pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.