Correlation Between KEURIG and Fidus Investment

Can any of the company-specific risk be diversified away by investing in both KEURIG and Fidus Investment 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 and Fidus Investment 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 Fidus Investment Corp, you can compare the effects of market volatilities on KEURIG and Fidus Investment 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 with a short position of Fidus Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of KEURIG and Fidus Investment.

Diversification Opportunities for KEURIG and Fidus Investment

-0.43

Correlation Coefficient

KEURIG  Fidus Investment

Very good diversification

The 3 months correlation between KEURIG and Fidus is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding KEURIG DR PEPPER and Fidus Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidus Investment Corp and KEURIG 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 Fidus Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidus Investment Corp has no effect on the direction of KEURIG i.e., KEURIG and Fidus Investment go up and down completely randomly.

Pair Corralation between KEURIG and Fidus Investment

Assuming the 90 days trading horizon KEURIG DR PEPPER is expected to under-perform the Fidus Investment. But the bond apears to be less risky and, when comparing its historical volatility, KEURIG DR PEPPER is 1.13 times less risky than Fidus Investment. The bond trades about -0.11 of its potential returns per unit of risk. The Fidus Investment Corp is currently generating about 0.41 of returns per unit of risk over similar time horizon. If you would invest  2,057  in Fidus Investment Corp on October 24, 2024 and sell it today you would earn a total of  113.00  from holding Fidus Investment Corp or generate 5.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	88.89%
Values	Daily Returns

KEURIG DR PEPPER  vs.  Fidus Investment Corp

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. Despite latest fragile performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for KEURIG DR PEPPER investors.

Fidus Investment Corp

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fidus Investment Corp are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Fidus Investment unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with KEURIG and Fidus Investment

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

The idea behind KEURIG DR PEPPER and Fidus Investment 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.

Check out your portfolio center.

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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.