Correlation Between Safety Shot and Keurig Dr

Can any of the company-specific risk be diversified away by investing in both Safety Shot and Keurig Dr 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 Safety Shot and Keurig Dr into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Safety Shot and Keurig Dr Pepper, you can compare the effects of market volatilities on Safety Shot and Keurig Dr 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 Safety Shot with a short position of Keurig Dr. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safety Shot and Keurig Dr.

Diversification Opportunities for Safety Shot and Keurig Dr

0.37

Correlation Coefficient

Safety Shot  Keurig Dr

Weak diversification

The 3 months correlation between Safety and Keurig is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Safety Shot and Keurig Dr Pepper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keurig Dr Pepper and Safety Shot 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 Safety Shot are associated (or correlated) with Keurig Dr. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keurig Dr Pepper has no effect on the direction of Safety Shot i.e., Safety Shot and Keurig Dr go up and down completely randomly.

Pair Corralation between Safety Shot and Keurig Dr

Assuming the 90 days horizon Safety Shot is expected to generate 29.0 times more return on investment than Keurig Dr. However, Safety Shot is 29.0 times more volatile than Keurig Dr Pepper. It trades about 0.08 of its potential returns per unit of risk. Keurig Dr Pepper is currently generating about -0.02 per unit of risk. If you would invest  14.00  in Safety Shot on May 6, 2025 and sell it today you would lose (8.00) from holding Safety Shot or give up 57.14% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.16%
Values	Daily Returns

Safety Shot  vs.  Keurig Dr Pepper

Safety Shot

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Safety Shot are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Safety Shot showed solid returns over the last few months and may actually be approaching a breakup point.

Keurig Dr Pepper

Risk-Adjusted Performance

Very Weak

Over the last 90 days Keurig Dr Pepper has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental indicators, Keurig Dr is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Safety Shot and Keurig Dr

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

The idea behind Safety Shot and Keurig Dr Pepper 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.