Correlation Between Uni President and Monster Beverage
Can any of the company-specific risk be diversified away by investing in both Uni President and Monster Beverage 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 Uni President and Monster Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uni President China Holdings and Monster Beverage Corp, you can compare the effects of market volatilities on Uni President and Monster Beverage 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 Uni President with a short position of Monster Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uni President and Monster Beverage.
Diversification Opportunities for Uni President and Monster Beverage
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Uni and Monster is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Uni President China Holdings and Monster Beverage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Monster Beverage Corp and Uni President 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 Uni President China Holdings are associated (or correlated) with Monster Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Monster Beverage Corp has no effect on the direction of Uni President i.e., Uni President and Monster Beverage go up and down completely randomly.
Pair Corralation between Uni President and Monster Beverage
Assuming the 90 days horizon Uni President China Holdings is expected to generate 5.97 times more return on investment than Monster Beverage. However, Uni President is 5.97 times more volatile than Monster Beverage Corp. It trades about 0.04 of its potential returns per unit of risk. Monster Beverage Corp is currently generating about 0.01 per unit of risk. If you would invest 78.00 in Uni President China Holdings on August 31, 2024 and sell it today you would earn a total of 9.00 from holding Uni President China Holdings or generate 11.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
Uni President China Holdings vs. Monster Beverage Corp
Performance |
| Timeline |
| Uni President China |
| Monster Beverage Corp |
Uni President and Monster Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uni President and Monster Beverage
The main advantage of trading using opposite Uni President and Monster Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uni President position performs unexpectedly, Monster Beverage 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 Monster Beverage will offset losses from the drop in Monster Beverage's long position.| Uni President vs. TITAN MACHINERY | Uni President vs. Australian Agricultural | Uni President vs. Austevoll Seafood ASA | Uni President vs. WIMFARM SA EO |
| Monster Beverage vs. COSMOSTEEL HLDGS | Monster Beverage vs. CosmoSteel Holdings Limited | Monster Beverage vs. Khiron Life Sciences | Monster Beverage vs. Daido Steel Co |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |