Correlation Between Molson Coors and Compagnie Plastic
Can any of the company-specific risk be diversified away by investing in both Molson Coors and Compagnie Plastic 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 Molson Coors and Compagnie Plastic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Molson Coors Beverage and Compagnie Plastic Omnium, you can compare the effects of market volatilities on Molson Coors and Compagnie Plastic 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 Molson Coors with a short position of Compagnie Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molson Coors and Compagnie Plastic.
Diversification Opportunities for Molson Coors and Compagnie Plastic
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Molson and Compagnie is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Molson Coors Beverage and Compagnie Plastic Omnium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie Plastic Omnium and Molson Coors 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 Molson Coors Beverage are associated (or correlated) with Compagnie Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie Plastic Omnium has no effect on the direction of Molson Coors i.e., Molson Coors and Compagnie Plastic go up and down completely randomly.
Pair Corralation between Molson Coors and Compagnie Plastic
Assuming the 90 days trading horizon Molson Coors is expected to generate 9.12 times less return on investment than Compagnie Plastic. But when comparing it to its historical volatility, Molson Coors Beverage is 2.54 times less risky than Compagnie Plastic. It trades about 0.04 of its potential returns per unit of risk. Compagnie Plastic Omnium is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 907.00 in Compagnie Plastic Omnium on September 13, 2024 and sell it today you would earn a total of 95.00 from holding Compagnie Plastic Omnium or generate 10.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Molson Coors Beverage vs. Compagnie Plastic Omnium
Performance |
| Timeline |
| Molson Coors Beverage |
| Compagnie Plastic Omnium |
Molson Coors and Compagnie Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Molson Coors and Compagnie Plastic
The main advantage of trading using opposite Molson Coors and Compagnie Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molson Coors position performs unexpectedly, Compagnie Plastic 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 Compagnie Plastic will offset losses from the drop in Compagnie Plastic's long position.| Molson Coors vs. Evolution Gaming Group | Molson Coors vs. Air Products Chemicals | Molson Coors vs. PureTech Health plc | Molson Coors vs. Universal Health Services |
| Compagnie Plastic vs. Taylor Maritime Investments | Compagnie Plastic vs. Livermore Investments Group | Compagnie Plastic vs. Smithson Investment Trust | Compagnie Plastic vs. Kaufman Et Broad |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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