Correlation Between Westrock Coffee and Keen Vision

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

By analyzing existing cross correlation between Westrock Coffee and Keen Vision Acquisition, you can compare the effects of market volatilities on Westrock Coffee and Keen Vision 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 Westrock Coffee with a short position of Keen Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westrock Coffee and Keen Vision.

Diversification Opportunities for Westrock Coffee and Keen Vision

0.0

Correlation Coefficient

Westrock Coffee  Keen Vision

Pay attention - limited upside

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

Pair Corralation between Westrock Coffee and Keen Vision

Given the investment horizon of 90 days Westrock Coffee is expected to under-perform the Keen Vision. In addition to that, Westrock Coffee is 24.97 times more volatile than Keen Vision Acquisition. It trades about -0.18 of its total potential returns per unit of risk. Keen Vision Acquisition is currently generating about 0.22 per unit of volatility. If you would invest  1,092  in Keen Vision Acquisition on October 11, 2024 and sell it today you would earn a total of  7.00  from holding Keen Vision Acquisition or generate 0.64% return on investment over 90 days.

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

Westrock Coffee  vs.  Keen Vision Acquisition

Westrock Coffee

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Westrock Coffee are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Westrock Coffee unveiled solid returns over the last few months and may actually be approaching a breakup point.

Keen Vision Acquisition

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Keen Vision Acquisition are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating fundamental indicators, Keen Vision may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Westrock Coffee and Keen Vision

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

The idea behind Westrock Coffee and Keen Vision Acquisition 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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.