Correlation Between PetMed Express and Kellanova
Can any of the company-specific risk be diversified away by investing in both PetMed Express and Kellanova 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 PetMed Express and Kellanova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PetMed Express and Kellanova, you can compare the effects of market volatilities on PetMed Express and Kellanova 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 PetMed Express with a short position of Kellanova. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetMed Express and Kellanova.
Diversification Opportunities for PetMed Express and Kellanova
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PetMed and Kellanova is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding PetMed Express and Kellanova in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kellanova and PetMed Express 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 PetMed Express are associated (or correlated) with Kellanova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kellanova has no effect on the direction of PetMed Express i.e., PetMed Express and Kellanova go up and down completely randomly.
Pair Corralation between PetMed Express and Kellanova
Given the investment horizon of 90 days PetMed Express is expected to under-perform the Kellanova. In addition to that, PetMed Express is 1.92 times more volatile than Kellanova. It trades about -0.37 of its total potential returns per unit of risk. Kellanova is currently generating about 0.12 per unit of volatility. If you would invest 5,514 in Kellanova on January 20, 2024 and sell it today you would earn a total of 140.00 from holding Kellanova or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetMed Express vs. Kellanova
Performance |
| Timeline |
| PetMed Express |
| Kellanova |
PetMed Express and Kellanova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetMed Express and Kellanova
The main advantage of trading using opposite PetMed Express and Kellanova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetMed Express position performs unexpectedly, Kellanova 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 Kellanova will offset losses from the drop in Kellanova's long position.| PetMed Express vs. High Tide | PetMed Express vs. China Jo Jo Drugstores | PetMed Express vs. Bimi International Medical | PetMed Express vs. Walgreens Boots Alliance |
| Kellanova vs. Campbell Soup | Kellanova vs. ConAgra Foods | Kellanova vs. Hormel Foods | Kellanova vs. Kraft Heinz Co |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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