Correlation Between Kellanova and Trump Media

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

By analyzing existing cross correlation between Kellanova and Trump Media Technology, you can compare the effects of market volatilities on Kellanova and Trump Media 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 Kellanova with a short position of Trump Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kellanova and Trump Media.

Diversification Opportunities for Kellanova and Trump Media

0.08

Correlation Coefficient

Kellanova  Trump Media

Significant diversification

The 3 months correlation between Kellanova and Trump is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Kellanova and Trump Media Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trump Media Technology and Kellanova 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 Kellanova are associated (or correlated) with Trump Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trump Media Technology has no effect on the direction of Kellanova i.e., Kellanova and Trump Media go up and down completely randomly.

Pair Corralation between Kellanova and Trump Media

Taking into account the 90-day investment horizon Kellanova is expected to generate 0.02 times more return on investment than Trump Media. However, Kellanova is 44.19 times less risky than Trump Media. It trades about 0.22 of its potential returns per unit of risk. Trump Media Technology is currently generating about -0.02 per unit of risk. If you would invest  8,111  in Kellanova on October 26, 2024 and sell it today you would earn a total of  66.00  from holding Kellanova or generate 0.81% return on investment over 90 days.

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

Kellanova  vs.  Trump Media Technology

Kellanova

Risk-Adjusted Performance

13 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kellanova are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Kellanova is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Trump Media Technology

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Trump Media Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Kellanova and Trump Media

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

The idea behind Kellanova and Trump Media Technology 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.