Correlation Between Keurig Dr and Mannatech Incorporated

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

Diversification Opportunities for Keurig Dr and Mannatech Incorporated

-0.43
  Correlation Coefficient

Very good diversification

The 3 months correlation between Keurig and Mannatech is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and Mannatech Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mannatech Incorporated 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 Mannatech Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mannatech Incorporated has no effect on the direction of Keurig Dr i.e., Keurig Dr and Mannatech Incorporated go up and down completely randomly.

Pair Corralation between Keurig Dr and Mannatech Incorporated

Considering the 90-day investment horizon Keurig Dr Pepper is expected to under-perform the Mannatech Incorporated. But the stock apears to be less risky and, when comparing its historical volatility, Keurig Dr Pepper is 3.8 times less risky than Mannatech Incorporated. The stock trades about -0.12 of its potential returns per unit of risk. The Mannatech Incorporated is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  756.00  in Mannatech Incorporated on September 17, 2024 and sell it today you would earn a total of  287.00  from holding Mannatech Incorporated or generate 37.96% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy96.92%
ValuesDaily Returns

Keurig Dr Pepper  vs.  Mannatech Incorporated

 Performance 
       Timeline  
Keurig Dr Pepper 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
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 fragile 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.
Mannatech Incorporated 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Mannatech Incorporated are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady technical and fundamental indicators, Mannatech Incorporated showed solid returns over the last few months and may actually be approaching a breakup point.

Keurig Dr and Mannatech Incorporated Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Keurig Dr and Mannatech Incorporated

The main advantage of trading using opposite Keurig Dr and Mannatech Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keurig Dr position performs unexpectedly, Mannatech Incorporated 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 Mannatech Incorporated will offset losses from the drop in Mannatech Incorporated's long position.
The idea behind Keurig Dr Pepper and Mannatech Incorporated 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.

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