Correlation Between Keurig Dr and Cheche Group

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

Diversification Opportunities for Keurig Dr and Cheche Group

-0.49

Correlation Coefficient

Keurig Dr  Cheche Group

Very good diversification

The 3 months correlation between Keurig and Cheche is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and Cheche Group Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheche Group Class 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 Cheche Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheche Group Class has no effect on the direction of Keurig Dr i.e., Keurig Dr and Cheche Group go up and down completely randomly.

Pair Corralation between Keurig Dr and Cheche Group

Considering the 90-day investment horizon Keurig Dr Pepper is expected to under-perform the Cheche Group. But the stock apears to be less risky and, when comparing its historical volatility, Keurig Dr Pepper is 4.01 times less risky than Cheche Group. The stock trades about -0.33 of its potential returns per unit of risk. The Cheche Group Class is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  82.00  in Cheche Group Class on October 12, 2024 and sell it today you would earn a total of  6.00  from holding Cheche Group Class or generate 7.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Keurig Dr Pepper  vs.  Cheche Group Class

Keurig Dr Pepper

Risk-Adjusted Performance

0 of 100

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 inconsistent performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Cheche Group Class

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cheche Group Class are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady fundamental indicators, Cheche Group reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Keurig Dr and Cheche Group

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

The idea behind Keurig Dr Pepper and Cheche Group Class 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.