Correlation Between Keurig Dr and Greene Concepts

Can any of the company-specific risk be diversified away by investing in both Keurig Dr and Greene Concepts 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 Greene Concepts 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 Greene Concepts, you can compare the effects of market volatilities on Keurig Dr and Greene Concepts 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 Greene Concepts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keurig Dr and Greene Concepts.

Diversification Opportunities for Keurig Dr and Greene Concepts

0.65

Correlation Coefficient

Keurig Dr  Greene Concepts

Poor diversification

The 3 months correlation between Keurig and Greene is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and Greene Concepts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greene Concepts 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 Greene Concepts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greene Concepts has no effect on the direction of Keurig Dr i.e., Keurig Dr and Greene Concepts go up and down completely randomly.

Pair Corralation between Keurig Dr and Greene Concepts

Considering the 90-day investment horizon Keurig Dr Pepper is expected to under-perform the Greene Concepts. But the stock apears to be less risky and, when comparing its historical volatility, Keurig Dr Pepper is 8.04 times less risky than Greene Concepts. The stock trades about -0.01 of its potential returns per unit of risk. The Greene Concepts is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  0.51  in Greene Concepts on September 2, 2024 and sell it today you would lose (0.39) from holding Greene Concepts or give up 76.47% of portfolio value over 90 days.

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

Keurig Dr Pepper  vs.  Greene Concepts

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 latest inconsistent performance, the Stock's fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Greene Concepts

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Greene Concepts has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's forward-looking signals remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Keurig Dr and Greene Concepts

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

The idea behind Keurig Dr Pepper and Greene Concepts 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.

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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.