Correlation Between Kimberly Parry and Winning Brands

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

By analyzing existing cross correlation between Kimberly Parry Organics and Winning Brands Corp, you can compare the effects of market volatilities on Kimberly Parry and Winning Brands 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 Kimberly Parry with a short position of Winning Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kimberly Parry and Winning Brands.

Diversification Opportunities for Kimberly Parry and Winning Brands

0.04

Correlation Coefficient

Kimberly Parry  Winning Brands

Significant diversification

The 3 months correlation between Kimberly and Winning is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Kimberly Parry Organics and Winning Brands Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Winning Brands Corp and Kimberly Parry 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 Kimberly Parry Organics are associated (or correlated) with Winning Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Winning Brands Corp has no effect on the direction of Kimberly Parry i.e., Kimberly Parry and Winning Brands go up and down completely randomly.

Pair Corralation between Kimberly Parry and Winning Brands

Given the investment horizon of 90 days Kimberly Parry Organics is expected to under-perform the Winning Brands. But the pink sheet apears to be less risky and, when comparing its historical volatility, Kimberly Parry Organics is 20.3 times less risky than Winning Brands. The pink sheet trades about -0.13 of its potential returns per unit of risk. The Winning Brands Corp is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  0.01  in Winning Brands Corp on October 12, 2024 and sell it today you would lose (0.01) from holding Winning Brands Corp or give up 100.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Kimberly Parry Organics  vs.  Winning Brands Corp

Kimberly Parry Organics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kimberly Parry Organics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Winning Brands Corp

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Winning Brands Corp are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile fundamental drivers, Winning Brands exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kimberly Parry and Winning Brands

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

The idea behind Kimberly Parry Organics and Winning Brands Corp 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 Stocks Directory module to find actively traded stocks across global markets.