Correlation Between Lancaster Colony and Kellanova
Can any of the company-specific risk be diversified away by investing in both Lancaster Colony 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 Lancaster Colony and Kellanova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lancaster Colony and Kellanova, you can compare the effects of market volatilities on Lancaster Colony 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 Lancaster Colony with a short position of Kellanova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lancaster Colony and Kellanova.
Diversification Opportunities for Lancaster Colony and Kellanova
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lancaster and Kellanova is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Lancaster Colony and Kellanova in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kellanova and Lancaster Colony 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 Lancaster Colony 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 Lancaster Colony i.e., Lancaster Colony and Kellanova go up and down completely randomly.
Pair Corralation between Lancaster Colony and Kellanova
Given the investment horizon of 90 days Lancaster Colony is expected to under-perform the Kellanova. In addition to that, Lancaster Colony is 1.09 times more volatile than Kellanova. It trades about -0.36 of its total potential returns per unit of risk. Kellanova is currently generating about 0.21 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 249.00 from holding Kellanova or generate 4.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lancaster Colony vs. Kellanova
Performance |
| Timeline |
| Lancaster Colony |
| Kellanova |
Lancaster Colony and Kellanova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lancaster Colony and Kellanova
The main advantage of trading using opposite Lancaster Colony and Kellanova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lancaster Colony 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.| Lancaster Colony vs. Bunge Limited | Lancaster Colony vs. Archer Daniels Midland | Lancaster Colony vs. Fresh Del Monte | Lancaster Colony vs. Limoneira Co |
| Kellanova vs. Bunge Limited | Kellanova vs. Archer Daniels Midland | Kellanova vs. Fresh Del Monte | Kellanova vs. Limoneira 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Stocks Directory Find actively traded stocks across global markets | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |