Correlation Between Karat Packaging and Tupperware Brands
Can any of the company-specific risk be diversified away by investing in both Karat Packaging and Tupperware Brands 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 Karat Packaging and Tupperware Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Karat Packaging and Tupperware Brands, you can compare the effects of market volatilities on Karat Packaging and Tupperware Brands 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 Karat Packaging with a short position of Tupperware Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karat Packaging and Tupperware Brands.
Diversification Opportunities for Karat Packaging and Tupperware Brands
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Karat and Tupperware is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Karat Packaging and Tupperware Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tupperware Brands and Karat Packaging 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 Karat Packaging are associated (or correlated) with Tupperware Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tupperware Brands has no effect on the direction of Karat Packaging i.e., Karat Packaging and Tupperware Brands go up and down completely randomly.
Pair Corralation between Karat Packaging and Tupperware Brands
Considering the 90-day investment horizon Karat Packaging is expected to generate 0.04 times more return on investment than Tupperware Brands. However, Karat Packaging is 25.49 times less risky than Tupperware Brands. It trades about 0.23 of its potential returns per unit of risk. Tupperware Brands is currently generating about -0.5 per unit of risk. If you would invest 2,513 in Karat Packaging on September 14, 2024 and sell it today you would earn a total of 695.00 from holding Karat Packaging or generate 27.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 6.35% |
Values | Daily Returns |
Karat Packaging vs. Tupperware Brands
Performance |
Timeline |
Karat Packaging |
Tupperware Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Karat Packaging and Tupperware Brands Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Karat Packaging and Tupperware Brands
The main advantage of trading using opposite Karat Packaging and Tupperware Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karat Packaging position performs unexpectedly, Tupperware Brands 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 Tupperware Brands will offset losses from the drop in Tupperware Brands' long position.Karat Packaging vs. Greif Bros | Karat Packaging vs. Reynolds Consumer Products | Karat Packaging vs. Silgan Holdings | Karat Packaging vs. O I Glass |
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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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