Correlation Between Dollar General and Kellanova
Can any of the company-specific risk be diversified away by investing in both Dollar General 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 Dollar General and Kellanova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dollar General and Kellanova, you can compare the effects of market volatilities on Dollar General 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 Dollar General with a short position of Kellanova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dollar General and Kellanova.
Diversification Opportunities for Dollar General and Kellanova
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dollar and Kellanova is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Dollar General and Kellanova in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kellanova and Dollar General 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 Dollar General 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 Dollar General i.e., Dollar General and Kellanova go up and down completely randomly.
Pair Corralation between Dollar General and Kellanova
Allowing for the 90-day total investment horizon Dollar General is expected to under-perform the Kellanova. In addition to that, Dollar General is 1.56 times more volatile than Kellanova. It trades about -0.13 of its total potential returns per unit of risk. Kellanova is currently generating about 0.26 per unit of volatility. If you would invest 5,565 in Kellanova on January 25, 2024 and sell it today you would earn a total of 313.00 from holding Kellanova or generate 5.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dollar General vs. Kellanova
Performance |
| Timeline |
| Dollar General |
| Kellanova |
Dollar General and Kellanova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dollar General and Kellanova
The main advantage of trading using opposite Dollar General and Kellanova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dollar General 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.| Dollar General vs. BJs Wholesale Club | Dollar General vs. Big Lots | Dollar General vs. Costco Wholesale Corp | Dollar General vs. Walmart |
| 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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