Correlation Between High Liner and MOLSON COORS
Can any of the company-specific risk be diversified away by investing in both High Liner 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 High Liner and MOLSON COORS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between High Liner Foods and MOLSON RS BEVERAGE, you can compare the effects of market volatilities on High Liner 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 High Liner with a short position of MOLSON COORS. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Liner and MOLSON COORS.
Diversification Opportunities for High Liner and MOLSON COORS
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between High and MOLSON is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding High Liner Foods and MOLSON RS BEVERAGE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOLSON RS BEVERAGE and High Liner 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 High Liner Foods 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 RS BEVERAGE has no effect on the direction of High Liner i.e., High Liner and MOLSON COORS go up and down completely randomly.
Pair Corralation between High Liner and MOLSON COORS
Assuming the 90 days horizon High Liner Foods is expected to under-perform the MOLSON COORS. In addition to that, High Liner is 1.36 times more volatile than MOLSON RS BEVERAGE. It trades about -0.02 of its total potential returns per unit of risk. MOLSON RS BEVERAGE is currently generating about 0.03 per unit of volatility. If you would invest 5,400 in MOLSON RS BEVERAGE on November 4, 2024 and sell it today you would earn a total of 50.00 from holding MOLSON RS BEVERAGE or generate 0.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
High Liner Foods vs. MOLSON RS BEVERAGE
Performance |
| Timeline |
| High Liner Foods |
| MOLSON RS BEVERAGE |
High Liner and MOLSON COORS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High Liner and MOLSON COORS
The main advantage of trading using opposite High Liner and MOLSON COORS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High Liner 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's long position.| High Liner vs. Tencent Music Entertainment | High Liner vs. WisdomTree Investments | High Liner vs. BOS BETTER ONLINE | High Liner vs. SALESFORCE INC CDR |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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