Correlation Between Electronic Arts and Molson Coors
Can any of the company-specific risk be diversified away by investing in both Electronic Arts and Molson Coors 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 Electronic Arts and Molson Coors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electronic Arts and Molson Coors Beverage, you can compare the effects of market volatilities on Electronic Arts and Molson Coors 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 Electronic Arts with a short position of Molson Coors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electronic Arts and Molson Coors.
Diversification Opportunities for Electronic Arts and Molson Coors
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Electronic and Molson is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Electronic Arts and Molson Coors Beverage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Molson Coors Beverage and Electronic Arts 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 Electronic Arts are associated (or correlated) with Molson Coors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Molson Coors Beverage has no effect on the direction of Electronic Arts i.e., Electronic Arts and Molson Coors go up and down completely randomly.
Pair Corralation between Electronic Arts and Molson Coors
Assuming the 90 days trading horizon Electronic Arts is expected to generate 0.69 times more return on investment than Molson Coors. However, Electronic Arts is 1.45 times less risky than Molson Coors. It trades about 0.18 of its potential returns per unit of risk. Molson Coors Beverage is currently generating about 0.06 per unit of risk. If you would invest 15,895 in Electronic Arts on September 12, 2024 and sell it today you would earn a total of 524.00 from holding Electronic Arts or generate 3.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electronic Arts vs. Molson Coors Beverage
Performance |
| Timeline |
| Electronic Arts |
| Molson Coors Beverage |
Electronic Arts and Molson Coors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electronic Arts and Molson Coors
The main advantage of trading using opposite Electronic Arts and Molson Coors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electronic Arts position performs unexpectedly, Molson Coors 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 Molson Coors will offset losses from the drop in Molson Coors' long position.| Electronic Arts vs. Hong Kong Land | Electronic Arts vs. Neometals | Electronic Arts vs. Coor Service Management | Electronic Arts vs. Fidelity Sustainable USD |
| Molson Coors vs. Hong Kong Land | Molson Coors vs. Neometals | Molson Coors vs. Coor Service Management | Molson Coors vs. Fidelity Sustainable USD |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| CEOs Directory Screen CEOs from public companies around the world |