Correlation Between CRA International and PEPSICO
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By analyzing existing cross correlation between CRA International and PEPSICO INC 55, you can compare the effects of market volatilities on CRA International and PEPSICO 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 CRA International with a short position of PEPSICO. Check out your portfolio center. Please also check ongoing floating volatility patterns of CRA International and PEPSICO.
Diversification Opportunities for CRA International and PEPSICO
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CRA and PEPSICO is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding CRA International and PEPSICO INC 55 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PEPSICO INC 55 and CRA International 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 CRA International are associated (or correlated) with PEPSICO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PEPSICO INC 55 has no effect on the direction of CRA International i.e., CRA International and PEPSICO go up and down completely randomly.
Pair Corralation between CRA International and PEPSICO
Given the investment horizon of 90 days CRA International is expected to generate 54.42 times less return on investment than PEPSICO. But when comparing it to its historical volatility, CRA International is 38.48 times less risky than PEPSICO. It trades about 0.05 of its potential returns per unit of risk. PEPSICO INC 55 is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 10,832 in PEPSICO INC 55 on September 24, 2024 and sell it today you would lose (45.00) from holding PEPSICO INC 55 or give up 0.42% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 61.65% |
Values | Daily Returns |
CRA International vs. PEPSICO INC 55
Performance |
Timeline |
CRA International |
PEPSICO INC 55 |
CRA International and PEPSICO Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CRA International and PEPSICO
The main advantage of trading using opposite CRA International and PEPSICO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CRA International position performs unexpectedly, PEPSICO 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 PEPSICO will offset losses from the drop in PEPSICO's long position.CRA International vs. Franklin Covey | CRA International vs. ICF International | CRA International vs. Huron Consulting Group | CRA International vs. FTI Consulting |
PEPSICO vs. Ryanair Holdings PLC | PEPSICO vs. SkyWest | PEPSICO vs. Air Transport Services | PEPSICO vs. Sun Country Airlines |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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