Correlation Between Good Natured and Crown Holdings

Can any of the company-specific risk be diversified away by investing in both Good Natured and Crown Holdings 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 Good Natured and Crown Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between good natured Products and Crown Holdings, you can compare the effects of market volatilities on Good Natured and Crown Holdings 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 Good Natured with a short position of Crown Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Good Natured and Crown Holdings.

Diversification Opportunities for Good Natured and Crown Holdings

-0.25

Correlation Coefficient

Good Natured  Crown Holdings

Very good diversification

The 3 months correlation between Good and Crown is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding good natured Products and Crown Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crown Holdings and Good Natured 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 good natured Products are associated (or correlated) with Crown Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crown Holdings has no effect on the direction of Good Natured i.e., Good Natured and Crown Holdings go up and down completely randomly.

Pair Corralation between Good Natured and Crown Holdings

If you would invest  0.54  in good natured Products on September 24, 2024 and sell it today you would earn a total of  0.00  from holding good natured Products or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	10.0%
Values	Daily Returns

good natured Products  vs.  Crown Holdings

good natured Products

Risk-Adjusted Performance

0 of 100

Modest

Over the last 90 days good natured Products has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly conflicting basic indicators, Good Natured reported solid returns over the last few months and may actually be approaching a breakup point.

Crown Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Crown Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Good Natured and Crown Holdings

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

The idea behind good natured Products and Crown Holdings 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.