Correlation Between Molson Coors and Scandic Hotels

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Can any of the company-specific risk be diversified away by investing in both Molson Coors and Scandic Hotels 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 Scandic Hotels 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 Scandic Hotels Group, you can compare the effects of market volatilities on Molson Coors and Scandic Hotels 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 Scandic Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molson Coors and Scandic Hotels.

Diversification Opportunities for Molson Coors and Scandic Hotels

MolsonScandicDiversified AwayMolsonScandicDiversified Away100%
-0.13
  Correlation Coefficient

Good diversification

The 3 months correlation between Molson and Scandic is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Molson Coors Beverage and Scandic Hotels Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandic Hotels Group 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 Scandic Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandic Hotels Group has no effect on the direction of Molson Coors i.e., Molson Coors and Scandic Hotels go up and down completely randomly.

Pair Corralation between Molson Coors and Scandic Hotels

Assuming the 90 days trading horizon Molson Coors Beverage is expected to generate 1.27 times more return on investment than Scandic Hotels. However, Molson Coors is 1.27 times more volatile than Scandic Hotels Group. It trades about 0.27 of its potential returns per unit of risk. Scandic Hotels Group is currently generating about 0.3 per unit of risk. If you would invest  5,498  in Molson Coors Beverage on November 30, 2024 and sell it today you would earn a total of  694.00  from holding Molson Coors Beverage or generate 12.62% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Molson Coors Beverage  vs.  Scandic Hotels Group

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -100102030
JavaScript chart by amCharts 3.21.150K2K 0RD7
       Timeline  
Molson Coors Beverage 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Molson Coors Beverage are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Molson Coors is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.
JavaScript chart by amCharts 3.21.15JanFebFeb52545658606264
Scandic Hotels Group 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Scandic Hotels Group are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Scandic Hotels unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15JanFebFeb657075808590

Molson Coors and Scandic Hotels Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.64-4.23-2.81-1.390.02361.392.834.265.77.14 0.050.100.15
JavaScript chart by amCharts 3.21.150K2K 0RD7
       Returns  

Pair Trading with Molson Coors and Scandic Hotels

The main advantage of trading using opposite Molson Coors and Scandic Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molson Coors position performs unexpectedly, Scandic Hotels 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 Scandic Hotels will offset losses from the drop in Scandic Hotels' long position.
The idea behind Molson Coors Beverage and Scandic Hotels Group 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

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