Correlation Between Keurig Dr and Cortus Metals

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

Diversification Opportunities for Keurig Dr and Cortus Metals

0.0

Correlation Coefficient

Keurig Dr  Cortus Metals

Pay attention - limited upside

The 3 months correlation between Keurig and Cortus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Keurig Dr Pepper and Cortus Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cortus Metals 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 Cortus Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cortus Metals has no effect on the direction of Keurig Dr i.e., Keurig Dr and Cortus Metals go up and down completely randomly.

Pair Corralation between Keurig Dr and Cortus Metals

If you would invest  3,214  in Keurig Dr Pepper on December 20, 2024 and sell it today you would earn a total of  133.00  from holding Keurig Dr Pepper or generate 4.14% return on investment over 90 days.

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

Keurig Dr Pepper  vs.  Cortus Metals

Keurig Dr Pepper

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Keurig Dr Pepper are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental indicators, Keurig Dr is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Cortus Metals

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cortus Metals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Cortus Metals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Keurig Dr and Cortus Metals

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

The idea behind Keurig Dr Pepper and Cortus Metals 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.