Correlation Between Argo Group and Molson Coors
Can any of the company-specific risk be diversified away by investing in both Argo Group 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 Argo Group and Molson Coors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argo Group Limited and Molson Coors Beverage, you can compare the effects of market volatilities on Argo Group 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 Argo Group with a short position of Molson Coors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argo Group and Molson Coors.
Diversification Opportunities for Argo Group and Molson Coors
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Argo and Molson is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Argo Group Limited 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 Argo Group 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 Argo Group Limited 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 Argo Group i.e., Argo Group and Molson Coors go up and down completely randomly.
Pair Corralation between Argo Group and Molson Coors
Assuming the 90 days trading horizon Argo Group is expected to generate 22.72 times less return on investment than Molson Coors. In addition to that, Argo Group is 1.16 times more volatile than Molson Coors Beverage. It trades about 0.01 of its total potential returns per unit of risk. Molson Coors Beverage is currently generating about 0.25 per unit of volatility. If you would invest 5,586 in Molson Coors Beverage on August 30, 2024 and sell it today you would earn a total of 559.00 from holding Molson Coors Beverage or generate 10.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Argo Group Limited vs. Molson Coors Beverage
Performance |
| Timeline |
| Argo Group Limited |
| Molson Coors Beverage |
Argo Group and Molson Coors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Argo Group and Molson Coors
The main advantage of trading using opposite Argo Group and Molson Coors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argo Group 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.| Argo Group vs. Optima Health plc | Argo Group vs. Spire Healthcare Group | Argo Group vs. Universal Music Group | Argo Group vs. Naturhouse Health SA |
| Molson Coors vs. Tungsten West PLC | Molson Coors vs. Argo Group Limited | Molson Coors vs. Hardide PLC | Molson Coors vs. Versarien PLC |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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