Correlation Between Keurig Dr and Aterian
Can any of the company-specific risk be diversified away by investing in both Keurig Dr and Aterian 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 Aterian 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 Aterian, you can compare the effects of market volatilities on Keurig Dr and Aterian 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 Aterian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keurig Dr and Aterian.
Diversification Opportunities for Keurig Dr and Aterian
Poor diversification
The 3 months correlation between Keurig and Aterian is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and Aterian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aterian 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 Aterian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aterian has no effect on the direction of Keurig Dr i.e., Keurig Dr and Aterian go up and down completely randomly.
Pair Corralation between Keurig Dr and Aterian
Considering the 90-day investment horizon Keurig Dr is expected to generate 3.63 times less return on investment than Aterian. But when comparing it to its historical volatility, Keurig Dr Pepper is 4.18 times less risky than Aterian. It trades about 0.04 of its potential returns per unit of risk. Aterian is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 213.00 in Aterian on September 18, 2024 and sell it today you would earn a total of 15.00 from holding Aterian or generate 7.04% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Keurig Dr Pepper vs. Aterian
Performance |
Timeline |
Keurig Dr Pepper |
Aterian |
Keurig Dr and Aterian Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Keurig Dr and Aterian
The main advantage of trading using opposite Keurig Dr and Aterian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keurig Dr position performs unexpectedly, Aterian 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 Aterian will offset losses from the drop in Aterian's long position.Keurig Dr vs. Celsius Holdings | Keurig Dr vs. Vita Coco | Keurig Dr vs. PepsiCo | Keurig Dr vs. Coca Cola Femsa SAB |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |