Correlation Between Penns Woods and Tupperware Brands

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

By analyzing existing cross correlation between Penns Woods Bancorp and Tupperware Brands, you can compare the effects of market volatilities on Penns Woods and Tupperware 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 Penns Woods with a short position of Tupperware Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penns Woods and Tupperware Brands.

Diversification Opportunities for Penns Woods and Tupperware Brands

-0.49

Correlation Coefficient

Penns Woods  Tupperware Brands

Very good diversification

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

Pair Corralation between Penns Woods and Tupperware Brands

Given the investment horizon of 90 days Penns Woods Bancorp is expected to generate 0.18 times more return on investment than Tupperware Brands. However, Penns Woods Bancorp is 5.71 times less risky than Tupperware Brands. It trades about 0.03 of its potential returns per unit of risk. Tupperware Brands is currently generating about -0.02 per unit of risk. If you would invest  2,428  in Penns Woods Bancorp on September 25, 2024 and sell it today you would earn a total of  626.00  from holding Penns Woods Bancorp or generate 25.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	86.69%
Values	Daily Returns

Penns Woods Bancorp  vs.  Tupperware Brands

Penns Woods Bancorp

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Penns Woods Bancorp are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Penns Woods exhibited solid returns over the last few months and may actually be approaching a breakup point.

Tupperware Brands

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tupperware Brands has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Tupperware Brands is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Penns Woods and Tupperware Brands

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

The idea behind Penns Woods Bancorp and Tupperware Brands 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.