Correlation Between Kerry Group and Kerry Group

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

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

Diversification Opportunities for Kerry Group and Kerry Group

0.69

Correlation Coefficient

Kerry Group  Kerry Group

Poor diversification

The 3 months correlation between Kerry and Kerry is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Kerry Group PLC and Kerry Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kerry Group plc and Kerry Group 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 Kerry Group PLC are associated (or correlated) with Kerry Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kerry Group plc has no effect on the direction of Kerry Group i.e., Kerry Group and Kerry Group go up and down completely randomly.

Pair Corralation between Kerry Group and Kerry Group

Assuming the 90 days horizon Kerry Group is expected to generate 2.48 times less return on investment than Kerry Group. But when comparing it to its historical volatility, Kerry Group PLC is 1.17 times less risky than Kerry Group. It trades about 0.12 of its potential returns per unit of risk. Kerry Group plc is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest  9,700  in Kerry Group plc on December 2, 2024 and sell it today you would earn a total of  610.00  from holding Kerry Group plc or generate 6.29% return on investment over 90 days.

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

Kerry Group PLC  vs.  Kerry Group plc

Kerry Group PLC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kerry Group PLC are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Kerry Group may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Kerry Group plc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kerry Group plc are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Kerry Group reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kerry Group and Kerry Group

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

The idea behind Kerry Group PLC and Kerry Group plc 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .